• After a Q1 earnings miss lass week, Alphabet (GOOG, GOOGL) stock is trading just above 2022 lows.
• YouTube ad revenue dropped, but the company still grew overall revenue 23% and its Pixel hardware could become more of a factor going forward.
• Investors should take advantage of the long-term growth potential of GOOG stock while it remains priced low.

Over the past five years, Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) has been a sure bet as a growth stock. At least up until last November it was. Like pretty much every other tech sector growth stock, GOOG stock got clobbered by the market pullback that started late last year. Shares are now trading near their 2022 low. They have essentially been reset to May 2021 levels, giving up the gains from the second half of 2021.

Some investors see this weakness as a signal to avoid GOOG stock for now. That instinct was likely reinforced by last week’s first quarter earnings miss. 

However, for investors who are focused on long-term growth, Alphabet continues to be a juggernaut. It may have lost some momentum since November, but that weakness is an opportunity. The company’s legacy businesses are still solid, and it continues to innovate rather than sitting still. Buy GOOG stock now, and you’re likely to be enjoying big returns when shares recover, and then kick back into growth mode.

 No Need to Panic About Alphabet’s Q1 Miss

Alphabet delivered an earnings miss on April 26, and the market reacted by sending GOOG stock down.

Admittedly, the Q1 news wasn’t great if you are an Alphabet shareholder. Overall revenue was $68.01 billion, which was up 23% year-over-year (YOY). However that missed analyst expectations. YouTube ad revenue in particular was a sore spot, suffering from increased competition in the social media video market. The company also felt the effects of halting its Russian operations. An earnings per share (EPS) of $24.62 also missed analyst projections, and dropped from the EPS of $26.29 reported the prior year.

However, given the current climate, the results could have been much worse. And there were positive signs to be found, including significant revenue growth in the company’s Other Bets, and Google Cloud divisions.

 Watch the Pixel Hardware Line for Future Growth

With Alphabet, there is a solid bedrock of business in search and ad revenue, plus high-profile future growth drivers like Google Cloud. And you never know what’s going to come out of the Future Bets division.

However, I want to highlight an area that tends to get little recognition: Google’s Pixel hardware.

After years of false starts, the company finally nailed it with last year’s Pixel 6 series smartphones. Last year, despite supply chain challenges, the Pixel 6 set all-time sales records for Google. Expect the company to build on that success with this year’s Pixel 7 smartphone.

We are also waiting for Google to formally announce its first Pixel smartwatch. We know it’s coming — the device has been outed in regulatory findings and a prototype was accidentally left behind in a restaurant. It’s not going to make or break GOOG stock, but look what rival Apple (NASDAQ:AAPL) has done with the Apple Watch. The smartwatch helped to power the company’s Wearables division to $8.8 billion in revenue last quarter.

Apple’s future growth is largely tied to harnessing its vast installed user base of devices to sell services. With Alphabet, the huge number of devices running Google’s Android operating system offer the opportunity to sell those users on premium Pixel hardware. To be clear, Pixel hardware is never going to rival ad revenue as a driver of GOOG stock growth, but it adds resiliency. And it shows the company is continuing to innovate.

Bottom Line: Should You Buy GOOG Stock?

The bottom line on GOOG stock is that any time it has dropped in value should be considered a buying opportunity. Check in with the investment analysts polled by the Wall Street Journal and you’ll find extremely strong support for Alphabet. GOOG stock is rated as a consensus “buy” by an overwhelming majority. The group’s average 12-month price target of $3,307.53 shows optimism that 2022’s slump is not going to last forever. It also suggests a very hefty 35% upside.

There are some concerns that made themselves apparent in Alphabet’s first quarter earnings, namely a miss in YouTube’s ad revenue. However, that was largely offset by growth in other areas including the increasingly important Google Cloud revenue.

Looking forward, don’t underestimate the potential of hardware sales, including Pixel smartphones and smartwatches. As Apple has shown, hardware can become a very lucrative business if you get it right.

At this point, GOOG stock is down over 15% in 2022 and is currently just above its low close for this year. From my perspective, with Alphabet’s long-term growth potential, any risk of GOOG slipping further this year is worth it.

On the date of publication, Brad Moon did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.