A Powerful Voice Just Reaffirmed My Confidence in My Non-Stop Alphabet Accumulation
Berkshire Hathaway just made a jaw-dropping move into a stock I have been quietly stacking for months, and the timing reveals something important about where the biggest money thinks this AI cycle is actually headed.
I keep hitting the buy button on Alphabet (NASDAQ:GOOGL | GOOGL Price Prediction), and this month a powerful voice gave me one more reason to keep going. Berkshire Hathaway lifted its Alphabet stake by 83%, making it the firm’s third-largest position. When the most patient capital allocator in modern investing goes that hard on a name I already own, I pay attention. I have been adding for months. I plan to keep adding.
Why That Powerful Voice Matters to Me
Buffett famously avoided Alphabet for two decades. Berkshire’s roughly $10 billion direct investment arrives just as Alphabet transforms from a cash-return machine into a capital-intensive AI infrastructure builder. That timing is the tell. Berkshire could buy anything. It bought more of what I own, and it did so while CEO Sundar Pichai was framing the AI cycle as a redefinition of “what’s possible across every part of our business.”
Three Numbers That Keep My Finger on the Buy Button
Start with valuation. GOOGL trades at a P/E of 16 and an earnings yield of 6.35%. For a business posting a return on invested capital of 29.60% and an operating margin of 32.06%, that multiple looks mispriced to me. The forward P/E of 23 already reflects the AI capex cycle, and I am fine paying it.
Next, growth is accelerating. Google Cloud grew 82% year over year in Q2 FY26 to $24.77 billion, up from 63% in Q1 and 48% in Q4 FY25. Total revenue hit $119.8 billion, up 24.23%. Reported EPS of 9.11 extended a 12-quarter EPS beat streak.
Third, the balance sheet still carries the business. Debt/equity sits at 0.143, interest coverage at 175.5x, and cash and equivalents at $55.91 billion. Even mid-buildout, this is a fortress.
Why Alphabet Over Microsoft, Amazon, or Meta
Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) are the reflexive cloud picks. Meta (NASDAQ:META) is the reflexive ad-market alternative. My problem with reaching for them instead is the distribution stack. None of them printed 82% cloud growth last quarter. Alphabet also owns Waymo, running 500,000+ autonomous rides per week, an optionality bucket the others cannot match. Nearly 90% of the Fortune 100 already use Gemini Enterprise, and the Gemini App serves 950 million monthly active users. Distribution wins, and Alphabet already owns the pipes.
Risk I Refuse to Wave Away
Capital intensity is the real concern. FY26 capex is guided at $175 to $185 billion. Q2 free cash flow ran negative $5.86 billion. Long-term debt jumped from $46.5 billion to $98.2 billion, the buyback was suspended, and management raised roughly $70 billion in combined equity and debt. That is dilution risk and cycle risk in one package. What keeps me buying anyway is the Google Cloud backlog of over $460 billion. Demand is already booked under contract, and the same buildout is lifting the power, cooling, and networking suppliers we profiled in a free report on seven AI infrastructure names that aren’t chipmakers.
Forward Conviction From Here
GOOGL is up 39.72% over the past year and 155.46% over five years, and the Street’s average target of $428.16 sits above today’s $354.97. I own this for the next decade of compounding cash flows. When Berkshire is buying alongside me at scale, I keep pressing the same button.
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Alex Sirois is a financial writer with experience spanning both retail and institutional investing. He has written for InvestorPlace and held roles at BNY Mellon and Bernstein, giving him a perspective that bridges Main Street portfolios and Wall Street analysis.
Alex holds an MBA from George Washington University and has built his career across multiple industries, including e-commerce, education, and translation — a breadth of experience that informs how he breaks down complex financial topics for everyday investors. His writing is conversational, actionable, and grounded in long-term, buy-and-hold investing principles.
At 247 Wall St., Alex focuses on delivering analysis that is both accessible and useful, with a clear emphasis on helping readers make more informed decisions with their money.
