Deutsche Bank: Investors' fears about Google are 'overblown'

Investors have "soured" on Google, according to an analyst note published on Wednesday by Deutsche Bank, but those fears may be "overblown," it says.

Google stock slid 3% last month after a report was published that predicted a drop in global spending on search ads. That drop was the biggest decline in Google's stock in two months.

But Deutsche Bank says that, actually, the outlook for Google is pretty good.

"The company continues to introduce a number of visible (and less known) tweaks to core search, which should help sustain growth in the near term," its analysts said in the research note.

The note also touches on Brexit. "We polled many SEM [search engine marketing] agencies, publishers and ad partners in the UK over the past two weeks," Deutsche Banks says, "and see limited risk to 2H estimates from Brexit."

Outside of Google Search, Deutsche Bank points to Google's expanding focus on artificial intelligence and machine learning as good indicators for growth.

Google acquired British AI startup DeepMind in 2014 for a rumoured £400 million. Deutsche Bank says decisions like that will start to pay off "in the next 12-18 months."