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.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
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.
Contact [email protected] for any questions or corrections.
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.
