Is GOOG Stock Still a Smart Investment in the Age of AI?
Alphabet Inc. (NASDAQ:GOOGL) remains a key player in the tech landscape, and a frequent pick among billionaire investors. But with the rapid evolution of Artificial Intelligence, is GOOG stock still a top investment choice? This article dives into the perspectives of leading investors and analyzes Alphabet’s recent performance, particularly its advancements in AI and cloud computing.
What Top Investors Say About GOOGL
David Abrams of Abrams Capital Management has held a position in Alphabet Inc. (NASDAQ:GOOGL) since Q2 2018. Initially holding around 2.5 million shares, the fund increased its stake to nearly 3 million by Q1 2020. While there were some reductions in holdings towards the end of 2022 and into 2024 (a 20% reduction in late 2022 and an 11% trim at the beginning of 2024, followed by another 10% in Q4 2025), Abrams Capital still maintains a significant position of approximately 1.9 million shares. This demonstrates continued confidence, albeit with some strategic adjustments.
Beyond Abrams, GOOGL features in the portfolios of numerous elite hedge funds, including those managed by Warren Buffett, George Soros, Jim Simons, and Steve Cohen. (See portfolio holdings at the end of this article).
Alphabet’s AI Powerhouse Status
Alphabet Inc. is widely recognized as an AI powerhouse. The company’s investments in AI are yielding positive results, particularly in its Google Cloud division. In Q4 2025, Google Cloud revenue surged an impressive 48%, reaching $17.7 billion. This growth surpassed that of Microsoft Azure for the first time in years, signaling a significant shift in the cloud market.
Cloud Contracts and Future Earnings
Institutional investors are increasingly drawn to Google Cloud due to its substantial backlog of contracts. Entering 2026, Google boasts a massive $240 billion backlog in cloud contracts, providing a highly predictable stream of high-margin future earnings. This strong financial foundation positions Google for continued growth and stability.
AI Overviews and Search Query Trends
Initial fears that AI would negatively impact Google’s core search business have largely subsided. The rollout of AI Overviews and the new AI Mode have actually increased search queries, especially those with high commercial value. This demonstrates Google’s ability to successfully integrate AI into its existing products and maintain its dominance in the search market.
Is GOOGL the Best AI Stock?
While GOOGL presents a compelling investment opportunity, our analysis suggests that other AI stocks may offer greater potential for higher returns within a shorter timeframe. If you’re seeking an AI stock with potentially explosive growth – boasting a 10,000% upside – we recommend exploring our report on the cheapest AI stock.
Other Stocks to Watch
Looking for more investment ideas? Check out these resources:
Disclaimer: This content is for informational purposes only and does not constitute financial advice. Always conduct your own research before making any investment decisions.
Hedge Fund Holdings (as of February 18th, 2026)
| Investor | Fund | Holdings (USD) |
|---|---|---|
| Warren Buffett | Berkshire Hathaway | $293,447,417,000 |
| David Einhorn | Greenlight Capital | $1,491,303,000 |
| George Soros | Soros Fund Management | $5,416,602,000 |
| Jim Simons | Renaissance Technologies | $77,426,184,000 |
| Leon Cooperman | Omega Advisors | $1,886,381,000 |
| Carl Icahn | Icahn Capital LP | $22,521,664,000 |
| Steve Cohen | Point72 Asset Management | $22,767,998,000 |
| John Paulson | Paulson & Co | $3,510,256,000 |
| David Tepper | Appaloosa Management LP | $4,198,712,000 |
| Paul Tudor Jones | Tudor Investment Corp | $6,160,740,000 |
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