Alphabet Inc. (NASDAQ:GOOGL) is one of the best AI stocks to buy for 2026, according to billionaire David Tepper. On May 5, Reuters reported that Alphabet Inc. (NASDAQ:GOOGL) is on the cusp of replacing Nvidia as the world’s most valuable company by market capitalization.
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The company has seen its market cap increase significantly on the back of increased investor interest impressed by its artificial intelligence efforts and booming cloud business. It has also emerged as one of the major AI service providers with its cloud platform. It is also taking Nvidia head-on with its custom processor that is winning big customers, including Anthropic.
Alphabet’s cloud computing growth has outpaced expectations and rivals, including Microsoft and Amazon, owing to greater AI integration across its offerings. Revenue in the Google Cloud segment was up by 63% in the first quarter. Investors have become increasingly confident that the company’s hundreds of billions of dollars in AI spending will pay off in the long run.
“High demand for cloud and AI offerings drove a ‘meaningful acceleration’ in growth, indicating to investors that significant ?AI investments are paying off,” Jeff Buchbinder, chief equity strategist at LPL Financial, said.
Separately, on May 9, Bloomberg reported that Isomorphic Labs, the AI‑powered drug discovery firm spun out of Alphabet’s Google DeepMind, is in advanced talks to raise over $2 billion in new funding. The round is expected to be led by Thrive Capital, which backed Isomorphic’s first raise last year, with Alphabet also participating, underscoring strong investor confidence in the company’s biotech‑AI strategy.
Alphabet Inc. (NASDAQ:GOOGL) is a leader in AI, investing heavily in research, infrastructure, and applications via Google. It plans up to $190 billion in capital expenditures by 2026 to support its AI initiatives.
While we acknowledge the potential of GOOGL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
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