Investing

Alphabet Only Requires a Tiny Bit of Faith So I Keep Pulling The Trigger

Alphabet keeps accelerating revenue growth at a scale that should be impossible, yet one glaring risk in its latest quarterly report gives every shareholder a reason to pause before clicking buy.

By Alex Sirois
Published October 7, 2026, 12:45pm ET · 3 min read

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A large, modern glass building with the white 'Google' logo prominently displayed on the upper part of the facade. Below the logo are multiple revolving glass doors, through which reflections and silhouettes of people are visible. A person in a dark jacket and blue jeans walks on the left side of the frame, past a light-colored stone planter. On the right, green foliage with vibrant pink-purple flowers is visible at the base of the building.
The Google headquarters stand as the company navigates significant departures of its top AI researchers. This talent drain has contributed to a notable dip in Alphabet's stock performance. © _ultraforma_ / Getty Images

I have added to my Alphabet (NASDAQ:GOOGL | GOOGL Price Prediction) position more times than I can count, and I keep coming back for more. Owning it takes a small amount of faith. I have to believe that a company already printing cash from Search will turn its AI spending into revenue. The quarterly reports tell me that is already happening.

Growth Keeps Speeding Up at Massive Scale

Big companies are supposed to slow down. Alphabet keeps getting faster. Revenue growth rose from 15.95% in Q3 FY2025 to 17.99%, then 21.79%, then 24.23% in Q2 FY2026. Google Cloud tells the same story in sharper form.

Its growth rose from 34% to 48% to 63% to 82% over those same four quarters. Search, the business that critics said AI would kill, grew 17% last quarter. And Cloud backlog stood at over $460 billion after the first quarter, so the demand is already signed.

Three Receipts Behind Every Purchase

First, I pay a fair price for that growth. Shares trade at about 23 times forward earnings, with a PEG ratio of 1.255. Operating margin expanded 2 points to 34% in Q2, and return on invested capital is 29.60%.

Second, Alphabet keeps delivering. Q2 marked its 11th consecutive EPS beat and its 12th straight quarter of double-digit revenue growth.

Third, the financial position lets me sleep. The debt-to-equity ratio is 0.143 and interest coverage is 175.5x. Management also raised the dividend 5% to $0.22 per share this year. The payout is small, and I value seeing it grow.

Why My Money Skips Microsoft and Amazon

Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) are the obvious cloud alternatives. I want the cloud business that is growing fastest, and a 24/7 Wall St. podcast noted that Google is significantly outgrowing Amazon in the cloud space, helped by its custom TPU chips. The market has noticed. Over the past year, Alphabet shares rose 39.2%, while Microsoft gained 0.97% and Amazon gained 16.02%.

Risk That Could Actually Hurt Me

The spending is huge. Management forecast 2026 capex to $175 billion to $185 billion. Free cash flow turned negative at -$5.86 billion in Q2. The company’s long-term debt grew from $46.5 billion to $98.2 billion, buybacks were suspended, and it raised $49.6 billion in net equity proceeds, which dilutes me as a shareholder. If AI demand stalls, those dollars become stranded assets. All that capex has to flow to someone, which is why we rounded up seven suppliers fueling the data-center expansion in a free AI infrastructure report.

The cash engine underneath stays strong, which is why I keep adding shares. Operating cash flow grew 40.8% to $39.07 billion last quarter, and customers are already paying for the capacity. Nearly 90% of the Fortune 100 use Gemini Enterprise.

Why the Buy Button Stays Active

The Gemini App reached 950 million monthly active users, and Google just announced its Gemini 4 Argon model. Wall Street has zero sell ratings on the stock. I treat that as background noise, though, because the numbers I track myself point the same way.

The faith I need keeps shrinking with every quarterly report, and that is why I keep buying.

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Alex Sirois

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.

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