Warren Buffett’s Berkshire Hathaway Just Bought More of This Popular Stock – Should You?

When Warren Buffett talks, people listen. But when his company Berkshire Hathaway buys a stock, investors do more than listen — they act. Since the Nov. 1 announcement that Berkshire had acquired $4.9 billion worth of Alphabet stock in Q3 2025, shares of GOOG have risen roughly 13%.

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The questions for investors are: does the stock have more room to run and is Buffett’s endorsement bullish for the long run?

Buffett’s exceptional track record as an investor is a big reason why his purchases make news. But it’s been his relative inaction over the past few years that has garnered the most headlines. As of Q3 2025, Berkshire Hathaway disclosed an incredible cash hoard of $381.6 billion, an all-time high. It also indicated that it had not bought back a single share of its own stock through the first nine months of 2025.

Thus, when Buffett and Berkshire picked up a sizable amount of Alphabet stock in Q3 2025, it marked a significant event. The fact that Buffett has long been reluctant to invest in high-flying technology stocks — and trimmed his position in Apple while picking up shares of Alphabet — made the purchase even more noteworthy.

Buffett hasn’t made any public statement as to why Berkshire Hathaway bought shares of Alphabet. But there are several reasons why Berkshire may have made the move:

• Valuation: At the time of Berkshire’s Q3 disclosure, Alphabet was trading at about $250 with an anticipated earnings growth of 14.94 percent next year. According to Reuters, this valued the company at a much lower multiple than some of its AI/tech peers, such as Microsoft and Nvidia.
  

• AI & cloud momentum: In the not-too-recent past, Alphabet was valued more as a pure “search advertising” business, which gave it a lower multiple. But Reuters reports that the company has made massive strides in AI infrastructure and Google Cloud, expanding its multiple more in line with broader technology companies.
  

• A changing investment mindset: Buffett has long been known for his avoidance of tech stocks. But Berkshire Hathaway’s Alphabet purchase could be the first indication that Buffett’s circle of investment managers is taking the reins as he heads towards retirement, according to CNBC. While the size of the purchase no doubt suggests that Buffett approved it, it likely originated from one of his key lieutenants.
  

• Buffett-like characteristics: Although Alphabet is a tech stock, it still has many of the features that Buffett prizes in an investment, such as a durable moat and high free cash flow, according to Morningstar.

There are certainly plenty of valid reasons for buying Alphabet, otherwise there’s no way one of the most highly regarded investors of all time would agree to pick up shares worth almost $5 billion. But does this mean that you should buy Alphabet? Not necessarily. Here are some pros and cons to consider.

Pros

• Buffett/Berkshire’s interest in Alphabet may continue to give the stock momentum, as it will remain in the news and analysts will highlight the strengths that Buffett sees in it.
  

• The Berkshire purchase has highlighted how Alphabet trades at a discount relative to many of its big-tech peers.
  

• If the hype surrounding Alphabet’s push into AI and its cloud story turns into real earnings, the stock has definite upside thanks to the company’s margin improvement and revenue expansion.
  

Cons

• Although $4.9 billion sounds like a large investment – and it certainly is – for a company with almost $400 billion in cash, the purchase is just a drop in the bucket. Berkshire’s vast resources allow it to take a long-term view of its investments and deploy capital strategically in a way that individual investors cannot.
  

• Even good technology companies can be volatile. Rising interest rates, souring consumer or investor sentiment, regulatory risk, and capital demands can all drive stock prices down.
  

• Even though Berkshire made the investment in Alphabet, Buffett on the whole is still cautious about equities. In Q3 2025, Berkshire was a net seller of equities, and it has not bought back a single share of its own stock on a YTD basis. The company also still holds a record cash pile, which can be interpreted as a signal that Buffett is wary of stock valuations.

Berkshire Hathaway’s purchase of Alphabet is a notable outlier. For a firm that’s conservatively positioned and generally negative on equities, the $4.9 billion Alphabet buy is a ringing endorsement. If the stock matches your investment objectives and risk tolerance, it could have a place in a well diversified portfolio. But you should never buy a stock simply “because Buffett did.” Buffett’s move may validate Alphabet as a long-term business, but it doesn’t replace the need for investors to evaluate valuation, risk, and time horizon on their own.

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