Alphabet (Google)

On June 1, 2026 Alphabet did something almost unheard of for a company sitting on a fortress balance sheet: it announced an $80 billion equity raise to fund AI compute. The structure tells you how aggressive the build-out has become — roughly $30 billion in underwritten public offerings, a $40 billion at-the-market program starting in Q3, and a $10 billion private placement bought directly by Berkshire Hathaway ($5B Class A at $351.81, $5B Class C at $348.20). Management's own framing: demand for Alphabet's AI solutions from enterprises and consumers is now outstripping available compute supply. With 2026 capex guided to $180-190 billion — roughly double the $91.4 billion spent in 2025 — Google is no longer just spending free cash flow on AI; it is raising fresh equity to keep up.

The reason the Street tolerates it sits in the Q1 2026 print. Revenue grew 22% to roughly $110 billion, the fastest quarterly growth since 2022. Google Cloud surged 63% to $20 billion, with backlog nearly doubling to over $460 billion as enterprise AI became Cloud's primary growth driver for the first time. Net income jumped 81% to $62.6 billion ($5.11 per share). At ~$376 per share and a ~$4.4 trillion market cap, GOOGL trades around 30× forward earnings — no longer the cheap mega-cap it was a year ago, but a stock the market now treats as a frontier-AI compounder rather than a regulated search monopoly.

Berkshire Hathaway's interest in Alphabet has gone from a quiet 13F line to an explicit strategic partnership. After first disclosing a position in early 2026, Warren Buffett's Berkshire is now anchoring the new raise with a $10 billion private placement, taking its total stake above $16 billion. This is no longer just a value bet on a cheap cashflow machine — buying primary shares at $348-352 to directly fund AI infrastructure is a vote of confidence in the build-out itself, and the smart-money community reads Greg Abel's fingerprints on a deal sized to matter at Berkshire scale.

Other notable positioning has shifted with the stock's re-rating. Funds that built positions in the $150-160s through 2025 are now sitting on large gains, and 13F watchers report broad mega-cap tech crowding into GOOGL as the antitrust overhang eased. Insider selling has been routine rather than alarming under Alphabet's pre-set 10b5-1 plans. The single biggest change versus a year ago is sentiment around the DOJ case: after Judge Mehta's September 2025 remedies ruling declined to force a Chrome divestiture, the existential tail risk that capped the multiple was largely removed, and institutional ownership has rebuilt accordingly.

Alphabet trades around $376 per share for a roughly $4.4 trillion market cap, near 30× consensus FY2026 EPS — analysts recently raised 2026 EPS estimates toward ~$14 and revenue toward ~$486 billion. That is a full re-rating from the ~24× of a year ago, driven by the removed Chrome-divestiture risk, 63% Cloud growth and the $460B backlog. Wall Street is overwhelmingly constructive: across 60+ covering analysts the consensus is Strong Buy with an average target near $430 (range roughly $334 to $515), implying high-teens upside; Piper Sandler moved to $445 on June 1. The debate is no longer whether GOOGL is cheap — it is whether ~30× and a $4.4T cap already discount perfect AI-capex execution.

1. July 28, 2026 (confirmed): Q2 2026 earnings (after close) — the first read on whether Cloud can sustain 60%+ growth, how fast the $460B backlog is converting, and whether the $80B raise changes the capex and free-cash-flow trajectory
2. Q3 2026: Launch of the $40B at-the-market equity program and deployment of the $80B raise into AI compute — the market will watch dilution pace against incremental Cloud revenue and supply additions
3. Late 2026 / Early 2027: Appellate arguments in the DOJ search case — Google contests the data-sharing remedies while the DOJ cross-appeals for Chrome/Android divestitures; the panel's read will define how durable the September 2025 reprieve really is

A year ago Alphabet was my cheapest mega-cap AI bet at 24×; today, at ~$376 and ~30× forward, the easy money is made and the thesis has changed shape. What I respect is that the September 2025 ruling took the Chrome-divestiture nightmare off the table, and the $460 billion Cloud backlog tells me the $180-190B capex is pre-sold, not speculative. What gives me pause is that Google is now raising $80 billion of equity to keep up with demand — even with Berkshire co-signing $10 billion of it, selling stock to fund capex is a signal I watch carefully. I am not adding aggressively here; the valuation cushion that protected me at 24× is gone. My add-trigger is a Q2 print where the backlog visibly converts to revenue and free cash flow holds despite the spend. The thesis breaks if the appellate panel reopens Chrome or if AI demand cools before that backlog turns into cash.