A Mix of Bullish Forces Boosted Alphabet (GOOG)

Investment management company Vulcan Value Partners recently released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. All the strategies of Vulcan Value Partners delivered positive results in the year. The Large Cap Composite (Net) returned -1.5% in Q4 and 7.9% YTD, the Small Cap Composite (Net) gained 3.2% in Q4 and 9.5% YTD, The Focus Composite (Net) retuned 0.1% in Q4 and 7.1% YTD, Focus Plus Composite (Net) returned 0.1% in Q4 and 6.2% YTD and the All-Cap Composite (Net) returned 1.3% in Q4 and 10.7% YTD. Despite overvalued markets, the firm improved its price-to-value ratios while still achieving positive returns, prioritizing safety and long-term gains over short-term performance. This situation echoes the late 1990s dot-com bubble, where hype and high valuations led to a crash, and today’s AI disruptions seem to mirror that pattern, with investors risking overpaying for promising businesses. The firm is addressing such situations by sticking to its investment discipline. For more information on the firm’s best picks in 2025, please check its top five holdings. In addition, please check the firm’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, Vulcan Value Partners highlighted Alphabet Inc. (NASDAQ:GOOG) as a material contributor within its Focus Plus Strategy. Alphabet Inc. (NASDAQ:GOOG), the parent company of Google, offers various platforms and services operating through Google Services, Google Cloud, and Other Bets segments. On January 26, 2026, Alphabet Inc. (NASDAQ:GOOG) stock closed at $333.59 per share. One-month return of Alphabet Inc. (NASDAQ:GOOG) was 6.11%, and its shares gained 72.16% of their value over the last 52 weeks. Alphabet Inc. (NASDAQ:GOOG) has a market capitalization of $4.02 trillion.

Vulcan Value Partners stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its fourth quarter 2025 investor letter:

“Alphabet Inc. (NASDAQ:GOOG) delivered strong results during the third quarter. Management reported that Gemini had reached 650 million monthly active users, which is up from 450 million in July with queries growing threefold. Google Cloud’s backlog increased 46% quarter-over-quarter. In November, Google released its new Gemini 3 model receiving strong feedback from users and large language model benchmarks. Based on media reports, Google’s tensor processing unit chips are receiving significant interest from large technology companies. We continue to monitor the AI disruption risks to Google’s core search business and the ongoing antitrust cases against the company and we will follow our discipline as we receive more information.”

Sentiment Mixed, But BofA Still Sees Long-Term Upside in Alphabet (GOOGL)

Alphabet Inc. (NASDAQ:GOOG) is in the 7th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 186 hedge fund portfolios held Alphabet Inc. (NASDAQ:GOOG) at the end of the third quarter which was 178 in the previous quarter. In the third quarter of 2025, Alphabet Inc. (NASDAQ: GOOG) achieved its first-ever $100 billion in revenue. While we acknowledge the risk and potential of Alphabet Inc. (NASDAQ:GOOG) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than Alphabet Inc. (NASDAQ:GOOG) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Alphabet Inc. (NASDAQ:GOOG) and shared the list of AI stocks in focus on Wall Street. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.