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Berkshire Raised Its Alphabet Share Count by 658% in a Single Quarter. Here's Where The Stock is Headed
24/7 Wall St. • • business
Key Points:
- Berkshire Hathaway’s significant increase in its Alphabet stake has drawn renewed investor focus, despite Alphabet’s stock cooling off from recent highs amid strong Google Cloud growth and Gemini adoption.
- Alphabet reported robust Q2 2026 results with 24.2% revenue growth and 82% Google Cloud acceleration, but shares dipped due to near doubling of capital expenditures and negative free cash flow.
- Bulls highlight Alphabet’s $514 billion Google Cloud backlog, expanding margins, and widespread Gemini usage, projecting a bull case price target of up to $510.93, while bears worry about high capex, rising debt, and regulatory fines.
- Compared to peers, Alphabet trades at a lower P/E ratio (17x) than Microsoft (28x) and Meta (22x), despite strong earnings growth, supporting the current price target of $445.49 with a 90% confidence level.
- The outlook remains constructive for investors with a 12-month horizon who trust Alphabet’s cloud backlog conversion and AI roadmap, though regulatory risks and capital intensity may cause caution for others.
