It’s safe to say that it has been tough in recent days for Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) investors. Since the unveiling of the Google parent’s Bard artificial intelligence (or AI) platform, GOOG stock has tumbled by around 11.6%, back down to double-digit price levels.

The market is not very confident that Bard will enable the tech giant to keep up with Microsoft (NASDAQ:MSFT) in the realm of AI. Microsoft, which recently invested billions into ChatGPT developer OpenAI, is integrating OpenAI’s technology into its platforms. This could pose a threat to Google’s dominance of the search engine market.

However, while Alphabet may be arguably losing the battle at the moment, that doesn’t necessarily mean it will lose in the emerging AI war. Instead of signaling the beginning of the end, this stock’s recent selloff may mean it’s close to re-entering the buy zone. Here’s why.

GOOG Stock: Looking Beyond the Fear and Hype

It’s not surprising that Bard’s public launch on Feb. 8 went over like a lead balloon. Besides some obvious blunders, such as the release of an ad demonstrating Bard giving an inaccurate answer to a question, the event provided little information regarding how Alphabet plans to use this platform, and its current AI technology, to take on the emerging Microsoft threat.

But while Alphabet clearly rushed out with its response to ChatGPT way too soon (as some of its employees have stated), it’s wise to not let fear and hype get the better of you when it comes to GOOG stock.

In other words, the fears about this company’s core business losing its market dominance may be misplaced. The impact of integrating ChatGPT into Microsoft’s Bing search engine could fail to live up to the current hype.

Alphabet may not be winning the AI war right now, but it hasn’t exactly lost it either. So far, the discussion has been about Bing possibly grabbing materially greater market share from Google. It hasn’t even started to happen yet. The company still has plenty of time to play catch-up while this technology remains in the early stages.

A Favorable Outcome From This Blunder?

While the market may have overreacted to Alphabet’s aforementioned Bard blunder, I admit that shares could continue to be affected in the near term by this development. Although finding support right now at around $95 per share, further pessimism could drive GOOG stock to even lower prices.

However, if this occurs and you’ve considered adding Alphabet shares to your portfolio as a long-term holding, pounce on it. As I have argued previously, the risk/return proposition with GOOG would become favorable again, if the stock fell back to or near its 52-week low ($83.45 per share).

I’m not saying that GOOG is set to drop again. Yet if it does occur, not only would prior uncertainties such as the risk of a longer-than-expected tech slowdown be baked into its valuation. So too would the uncertainties surrounding Bing’s potentially emerging status as a “Google killer.”

From there, whether from macro-related issues clearing up, or from Alphabet making some well-received AI progress, the stock may have the ability to experience a rebound of nearly 48%.

How? Let’s do the math.

Bottom Line

Over the next year, as economic conditions normalize, Alphabet may be on track to deliver earnings in line with the sell-side’s 2024 forecast ($6.16 per share).

During this timeframe, subsequent AI developments from the company may help assuage concerns that Microsoft will seriously impact the future growth and profitability of Google’s search unit.

This may be more than enough to get GOOG, trading for 18.6 times forward earnings today, back to a forward earnings multiple of 20x.

Multiply next year’s earnings forecast by this multiple, and we get a target price of around $123.20 per share, or around 47.6% above the stock’s 52-week low. Again, there’s no guarantee Alphabet will retest its lows.

But as the potential for a further selloff remains, keep an eye on GOOG stock. You may just well get the opportunity to scoop it up at a favorable entry point.

On the date of publication, Thomas Niel did not hold (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.