Wedbush analysts Dan Ives and Scott Devitt believe that the risks of AI to Alphabet Inc.'s (GOOG  ) (GOOGL  ) crown jewel, Google Search, are "overstated."

What Happened: Google has been added to Wedbush's Best Ideas List (BIL), with the target price being raised from $160 to $175 with an "outperform" rating.

In a note seen by Benzinga, Wedbush asserts that Alphabet could be a potential beneficiary of generative AI.

"We believe the perceived structural risks to Google Search are overstated and continue to view Alphabet as a net beneficiary of generative AI."

Despite Alphabet's shares trailing behind mega-cap peers like Amazon Inc. (AMZN  ) and Microsoft Corp. (MSFT  ), Wedbush anticipates a shift in sentiment despite the widespread controversy over historically inaccurate images generated by Gemini's image creation tool.

Wedbush is buoyed by Alphabet's recent public comments on generative AI and Google Search, as well as reports of negotiations between Google and Apple Inc. (AAPL  ) to integrate Gemini in upcoming iPhone software updates.

Deepwater Asset Management's Gene Munster also sounded optimistic about Google's potential deal with Apple, saying this is what Google investors have been "waiting for the last six months."

Wedbush anticipates potential catalysts if Alphabet's management takes direct action to alleviate investor concerns. These catalysts are:

• Better communication about the impact of Search Generative Experience on its business.
• Aggressive cost reengineering to protect margins.
• Continued momentum in the enterprise generative AI segment.

Criticism has been leveled at CEO Sundar Pichai for a perceived lack of vision, with reports of employee dissatisfaction and talent loss to rivals like Apple.

The company's struggles with its Gemini AI chatbot have highlighted the potential threat of AI to its search engine.

Price Action: On Friday, Alphabet Inc Class A shares were up 2.33% after closing at $147.55 on the previous day, according to Benzinga Pro.