We just covered the
ChatGPT Stock Portfolio: Top 7 Picks For 2026. Alphabet Inc (NASDAQ:GOOGL) ranks #1 (see ChatGPT Stock Portfolio: Top 4 Picks For 2026).
Number of Hedge Funds: 265
ChatGPT opened a position in Alphabet Inc (NASDAQ:GOOGL) in late March, according to Rallies Arena X account.
The AI chatbot bull case was simple: it’s a good idea to pile into a quality stock that is an AI winner instead of buying a CapEx-heavy AI infrastructure stock that is burning cash. At a macro level, ChatGPT said it’s still seeing a higher-for-longer interest rate scenario, which is why it prefers cash-rich companies with strong earnings growth.
There were widespread concerns that Google’s search business would be significantly disrupted by the rise of AI-powered alternatives, but search has proven far more resilient than feared. In the most recently reported quarter, search grew 19% year over year. Google Cloud was the real standout, surging 63% year over year, driven primarily by AI-related token usage and enterprise cloud adoption. Gemini, Google’s AI model, has also gained meaningful traction with paid subscriptions now reaching 350 million users, processing over 16 billion tokens per minute via direct API.
However, Google shares are up roughly 120% over the past year and many believe the stock’s valuation is reaching stretched territory. Ad revenue remains the bread and butter of the business, and that dependence is a lingering concern that ad spending is cyclical and highly sensitive to economic conditions. While Waymo and the robotics division generate significant buzz, both remain unprofitable.
L1 Capital International Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q1 2026 investor letter:
Portfolio adjustments during the March 2026 quarter were relatively modest, but deliberate. We trimmed investments in AerCap, Alphabet Inc. (NASDAQ:GOOGL), HCA Healthcare and Weir Group at prices around the top end of our assessed fair value range, with all of these businesses benefitting from positive sentiment intra-quarter. Alphabet’s share price has more than doubled over the past 12 months. This reflects strong performance in core Search, continued momentum in Google Cloud Platform, and better-than-expected progress in AI (Gemini). Today Alphabet has a market capitalisation approaching US$4 trillion. Share prices and fair value are not always aligned, even for the world’s largest companies (Click Here to Read the Letter in Detail).
Photo by Firmbee.com on Unsplash
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.
