Jim Cramer: Waymo's soaring valuation adds a new layer to the Alphabet buy story

CNBC Finance

4 min read

Waymo is becoming a real source of investor excitement on new valuation reports â reaffirming Jim Cramer's view that the Alphabet stock remains a buy for that and so much more. Once an Alphabet moonshot, launched as the Google Self-Driving Car project in 2009, Waymo nowadays is shooting to the moon. The robotaxi business is currently looking to close a $16 billion financing round at a nearly $110 billion valuation, according to Saturday reports from Bloomberg and the Financial Times . The financing â which could close as soon as this month â is said to involve new investors, including Sequoia Capital, DST Global, and Dragoneer Investment Group. Alphabet shares advanced 1.4% on Monday â reaching an all-time intraday high of nearly $345 each and continuing their positive 9.5% upswing to start the new year. The Google-parent stock really caught fire last year and gained more than 65% in 2025. For Jim, the Waymo news underscores why Alphabet continues to stand out against the tech landscape. "Waymo is dominant right now over what Tesla is doing," Jim Cramer said Monday during the Morning Meeting for Club members. Waymo competes with Tesla's robotaxis, which are being tested and operated in Austin, Texas. Tesla shares were down more than 1% on Monday. Waymo operates in the Phoenix, Arizona area, as well as the San Francisco Bay Area, and in Los Angeles. Miami just started last month, and Washington, D.C is next. Waymo partnered with Uber to bring the service to Austin and Atlanta. There has been speculation about whether Alphabet will eventually spin Waymo off into a separate business. Yet, the target $110 billion valuation is light years away from rival Tesla's nearly $1.6 trillion market capitalization. It is worth noting that robotaxis only represent a small part of Tesla, which last week announced an end to its production of Model S and X passenger electric vehicles in a shift to building robots. "I know that Waymo is small potatoes compared to so much of Alphabet, but it is big potatoes for a public starved of anything that a consumer might be fascinated by, hence the love for Elon Musk ," Jim wrote in his Sunday column . "They are even better as a template for generations of non-drivers to come. Sure, a Jaguar robotaxi is expensive, but there could be iterations that we don't know about. Suffice it to say: buy, buy, buy," he wrote. Roughly seven years after launching , Waymo became a standalone Alphabet subsidiary in 2016 and was housed in its Other Bets operating segment. For years, it weighed on Alphabet's financials due to heavy investment and losses. That narrative has steadily changed as Waymo expanded operations. Beyond Waymo, Jim emphasized that Alphabet's strength runs across its business portfolio. "Every single division is a dominant division," Jim said, citing YouTube as the leading video platform, Gemini's growing foothold in AI and partnership with Apple, Google Cloud's position as No. 3 behind Amazon and Microsoft, and, of course, Google Search's continued dominance. In his column, Jim also revisited last year's concerns about the Justice Department's antitrust lawsuit, which had overshadowed the stock. With that risk off the table, Jim said investors should focus on what lies ahead. "We don't care where it's been, we care where it's going." Alphabet is set to report fourth-quarter earnings on Wednesday evening. Jim predicts a blowout quarter. While looking for updates on Waymo, we will, more importantly, want to see growth in Google Cloud as well as what else the company has in store for its advancements in AI. We maintain our buy-equivalent 1-rating on Alphabet stock and $350-per-share price target. (Jim Cramer's Charitable Trust is long GOOGL. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.

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