Tracking billionaire-run hedge funds is a smart move for investors. This information is made available to investors 45 days after a quarter ends through a Form 13F. Looking for patterns as to what stocks these funds are buying is a great way to discover new ideas or confirm your thesis on a stock you own.
One stock that I'm a huge fan of that management companies led by billionaires increased their positions in during the third quarter of 2025 is Alphabet (GOOG +5.32%) (GOOGL +5.27%). Alphabet stock was bought by legendary investor Warren Buffett's Berkshire Hathaway and Billionaire Philippe Laffont's Coatue Management also increased its position.
With two billionaire-run funds purchasing Alphabet, it's a vote of confidence that Alphabet is a great stock to own. However, these transactions were made sometime between July 1 and Sept. 30, so is Alphabet still a great stock to buy today?
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Alphabet has turned from a loser to a leader in the AI race
At the start of the artificial intelligence (AI) race, Alphabet was assumed to be a loser. It was too late to launch its own generative AI model, and its initial launch also fell flat on its face. Eventually, Alphabet got its model right, and Gemini is one of the leading AI models on the marketplace. It has been seamlessly integrated into the Google Search engine through AI overviews, which provide a generative AI-powered summary of each search result. This bridges the gap between new-age AI and traditional search, cementing Google's place as the front page of the internet.
NASDAQ: GOOGL
Key Data Points
Alphabet also received positive news during the quarter regarding its business practices. Alphabet was accused of running an illegal monopoly in its search and advertising businesses. While it was found guilty of these practices, the judge presiding over its case thought the Justice Department's calls to break up Alphabet were too strong. So, it forced Alphabet to make some concessions, but the company mostly survived the court case unscathed.
News of Alphabet escaping a breakup sent the stock soaring and ignited a massive run-up in the stock.
Depending on when these billionaires purchased the stock, they could be up almost 50% on their investment already. That's a monstrous return over the span of five months, especially for a tech behemoth like Alphabet.
The question is, after a huge run like that, is Alphabet still a buy now?
Alphabet is still cheap compared to its peers
With all of the question marks surrounding Alphabet cleared, the market is free to value Alphabet for the business it truly is. During Q3, Alphabet grew revenue at a 16% year-over-year pace and increased its diluted earnings per share (EPS) by 35% year over year. Few tech stocks outside of Nvidia are delivering strong growth like that, so it's safe to say that Alphabet deserves to have a bit of a premium to that market and its peers.
At about 26 times next year's earnings, Alphabet is certainly valued at that level.
GOOGL PE Ratio (Forward 1y) data by YCharts
Alphabet is no longer the bargain stock it was just a few months ago, and now has a premium valuation like its big tech peers. However, I think Alphabet is well positioned to continue capitalizing on current market conditions through strong growth and an excellent AI strategy. Alphabet also has a thriving cloud computing business and quantum computing endeavors.
Although the upside isn't as high as it once was, I still think Alphabet has the growth rates and catalysts to beat the market over the long term.
