We recently published a list of Billionaire Bill Ackman’s 7 Stock Picks with Huge Upside Potential. In this article, we are going to take a look at where Alphabet Inc. (NASDAQ:GOOGL) stands against other billionaire Bill Ackman’s stock picks with huge upside potential.
Known commonly as Bill Ackman, William Albert Ackman is the founder and Chief Executive Officer of Pershing Square, a hedge fund renowned for its focused investment strategy and high-conviction portfolio. Ackman is known for maintaining a highly concentrated investment approach, often holding stakes in only 8 to 12 companies at any given time. By the end of the fourth quarter of 2024, Pershing Square’s portfolio was valued at $12.66 billion and included ten stocks, with over 50% of the fund’s capital concentrated in just the top four investments. This exemplifies Ackman’s commitment to identifying and capitalizing on undervalued opportunities, favoring companies that he believes are mispriced in relation to their intrinsic, long-term value.
Ackman’s investment philosophy has largely centered on value-based principles and activist strategies. His ability to identify market inefficiencies and apply pressure for change has yielded significant returns in the past. Pershing Square’s portfolio selections typically reflect this strategy, with a strong emphasis on companies with solid fundamentals and potential for operational or financial turnaround.
In early 2024, Ackman took a notable step by launching a U.S. closed-end fund named Pershing Square USA, Ltd. However, the initial public offering (IPO) of the fund was abruptly canceled just one day after filing with the Securities and Exchange Commission (SEC). The cancellation followed an unexpected drop in valuation from an intended $25 billion to just $2 billion. Following the cancellation, Ackman posted on the social media platform X that the firm would “report back once we are ready to launch a revised transaction,” suggesting that Pershing Square USA may still proceed in the future without a traditional stock exchange listing.
Ackman’s active engagement with both market trends and political developments illustrates his multifaceted approach to investing. As Pershing Square continues to evolve, close attention is being paid to the stocks within its concentrated portfolio, particularly those with the highest upside potential in light of current economic and political tailwinds.
Our Methodology
For this list, we searched through Pershing Square’s Q4 2024 13F filings to identify billionaire Bill Ackman’s stock picks with the highest upside potential. We compiled the equities with upside potential higher than 12% at the time of writing this article and analyzed why they stood out as sound potential investments. Finally, we ranked the stocks based on the ascending order of their upside potential. To assist readers with more context, we mentioned the hedge fund sentiment around each stock using data from 1,009 hedge funds tracked by Insider Monkey in the fourth quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 363.5% since May 2014, beating its benchmark by 208 percentage points (see more details here).
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Alphabet Inc. (NASDAQ:GOOGL)
Number of Hedge Fund Holders as of Q4: 234
Pershing Square’s Equity Stake: $1.44 Billion
Upside Potential as of May 5: 22.06%
Alphabet Inc. (NASDAQ:GOOGL), a parent company of Google, remains a central figure in the technology sector and is currently the only tech stock held by Bill Ackman’s Pershing Square. As such, it serves as the hedge fund’s sole exposure to the booming artificial intelligence (AI) industry, making it a critical strategic investment. Among Ackman’s portfolio, Alphabet stands out with a notable upside potential of 22.06%, positioning it as one of the top stocks with significant growth prospects. The company has also seen increasing hedge fund interest—by the end of Q4 2024, 234 hedge funds out of 1,009 tracked by Insider Monkey held stakes in GOOGL, up from 202 funds in the previous quarter. The total value of these holdings reached $39.59 billion, indicating rising confidence among institutional investors.
For the first quarter of 2025, Alphabet Inc. (NASDAQ:GOOGL) reported stronger-than-expected financial results, with earnings per share (EPS) of $2.81 and revenue of $90.2 billion. These figures surpassed analysts’ estimates, which had projected EPS of $2.01 on revenue of $89.1 billion. Comparatively, during Q1 of the previous year, the company posted EPS of $1.89 on revenue of $80.5 billion, highlighting substantial year-over-year growth. A major contributor to this performance was Google’s advertising division, which brought in $66.8 billion, slightly above the anticipated $66.4 billion. Meanwhile, the Google Cloud Platform generated $12.2 billion in revenue, just below the $12.3 billion forecast, but still a marked improvement from the $9.5 billion it posted in Q1 2024.
Despite these strong financial results, Alphabet Inc. (NASDAQ:GOOGL) is facing significant regulatory challenges. In April 2025, a U.S. federal judge ruled that Google maintains an illegal monopoly over the online advertising market, a decision that could compel the company to divest or reorganize its advertising operations. This ruling comes on the heels of another antitrust loss less than a year earlier, in which Google’s search and ad businesses were also found to be in violation of U.S. antitrust laws. These ongoing legal battles cast uncertainty over parts of Alphabet’s core business, even as it continues to grow its revenues and deepen its presence in the AI space.
Oakmark Equity and Income Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q4 2024 investor letter:
“Alphabet Inc. (NASDAQ:GOOGL) was the top contributor during the quarter. Despite ongoing litigation with the Department of Justice in its antitrust case, the U.S.-headquartered interactive media and services company’s stock price rose after posting solid third-quarter earnings. In the Search division, the company generated low-teens year-over-year revenue growth and management highlighted that they’re seeing strong user engagement with their new AI Overviews feature. The biggest upside surprise came from the Cloud division, where revenue growth accelerated to 35% and margins reached a record of 17%. This performance was driven by client demand for AI Infrastructure and Generative AI Solutions as well as core Google Cloud Platform (GCP) products. We continue to believe Alphabet is a collection of great businesses that can unlock further value over the long term through its world-class AI capabilities.”
Overall, GOOGL ranks 4th on our list of billionaire Bill Ackman’s stock picks with huge upside potential. While we acknowledge the potential of GOOGL as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter timeframe. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GOOGL but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
