Alphabet's stock rose 14% in September, driven by a favorable legal ruling that averted a government-mandated breakup and robust Q2 Google Search revenue growth of 12% year-over-year, demonstrating resilience against generative AI disruption through successful integration. This combination of mitigated regulatory and competitive fears, coupled with its position as one of the cheapest big tech stocks despite strong 14% revenue and 22% diluted EPS growth, suggests significant upside potential for the company.
Key PointsInvestors are starting to realize that Google Search isn't going away. A judge ruled that Alphabet doesn't need to be broken up. Alphabet is still one of the cheapest big tech stocks on the market. - 10 stocks we like better than Alphabet › Investors are starting to realize that Google Search isn't going away. A judge ruled that Alphabet doesn't need to be broken up. Alphabet is still one of the cheapest big tech stocks on the market. Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) had an incredible run during September. Its stock rose 14% throughout the month, which is a huge move considering that Alphabet is around a $3 trillion company. Although last month was a strong run for Alphabet, I think there's plenty of room for more upside due to the catalysts of why its stock moved higher. I think Alphabet remains at the top of the list of stocks to buy right now, as the stock could experience even more strength throughout October and into the end of the year. Where to invest $1,000 right now? Our analyst team just revealed what they believe are the 10 best stocks to buy right now, when you join Stock Advisor. See the stocks » Alphabet had a legal ruling go its way during September Alphabet is the parent company of Google, among many other brands. Since its inception, this has been a great business to be in, except for recently. A few months ago, the future of the Google Search engine was in question. There were two major factors contributing to this uncertainty: Government intervention and generative artificial intelligence (AI). Many investors assumed that generative AI-powered search engines would disrupt Google's business, causing advertisers to go elsewhere. However, that hasn't surfaced yet, and Google continues to post strong results quarter after quarter. In Q2, Google Search's revenue rose 12% year over year. That doesn't sound like a struggling business, and underscores that Google is still a top place to advertise. One factor that's helping it out is the integration of AI search overviews. This provides a generative AI-powered search summary at the top of each Google Search, essentially merging the two technologies into one platform. AI search overviews have become an incredibly popular feature, and will likely bridge the gap between the two technologies. As a result, it seems like Google Search is here to stay. Another fear quelled during September was the concern about a government breakup. Alphabet was accused of operating an illegal monopoly in the search engine space, and the Department of Justice sought to split Google Chrome off as a remedy. The judge presiding over the case thought this was too far of a reach, and instead forced Alphabet to make some changes, but essentially allowed it to operate as is. The ruling was perceived as a major win for Alphabet, and eased investors' fears about Alphabet looking far different than its current state a few years down the road. Both items contributed to Alphabet's stock price rising over the past month, but I think it has plenty of room to grow. The stock is reasonably priced compared to its peers With the easing of both fears, investors can now appreciate Alphabet's stock for the company dominance it shows. During its last quarter, Alphabet's revenue rose 14% year over year and its diluted earnings per share increased by 22%. That places Alphabet in solid growth stock territory and growing at a quicker pace than many of its big tech peers. Despite Alphabet's strength, it is still priced at the bottom end of its peers. I think the combination of Alphabet's relatively low valuation (at least compared to its peers) and strong growth makes it one of the top big tech stocks to buy right now. It could see a sustained rally to end the year and be a strong stock pick for 2026. Alphabet also has a lot of momentum going with its own generative AI platform, Gemini. Gemini consistently ranks as one of the top-performing generative AI models, and with its integration into the Google Search engine, it is the most used. With Alphabet having a solid model to base future products on, it creates momentum that could lead to further growth during 2026. The future is incredibly bright for Alphabet, and I think investors would be smart to scoop up shares during October. Should you invest $1,000 in Alphabet right now? Before you buy stock in Alphabet, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Alphabet wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $621,976! Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,150,085! Now, it’s worth noting Stock Advisor’s total average return is 1,058% — a market-crushing outperformance compared to 191% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor. Stock Advisor returns as of September 29, 2025 Keithen Drury has positions in Alphabet, Amazon, and Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, and Microsoft. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Alphabet (GOOGL) experienced a significant 14% stock price increase in September, a rally driven by the mitigation of two primary overhangs: regulatory intervention and competitive threats from generative AI. A key catalyst was a favorable court ruling that prevented a government-mandated breakup, specifically rejecting the Department of Justice's proposal to split off the Google Chrome browser, which alleviates significant near-term structural risk. Concurrently, fears of disruption to its core search business have subsided, as evidenced by a robust 12% year-over-year increase in Google Search revenue in the second quarter. The company is actively defending its moat by integrating its own AI, with features like 'AI search overviews' and its highly-ranked Gemini model, effectively merging new technology into its existing dominant platform. This strategic adaptation is supported by strong financial performance, with overall company revenue growing 14% and diluted earnings per share (EPS) increasing by 22% in its most recent quarter. Despite this solid growth, the article highlights that the stock trades at a relatively low valuation compared to its big tech peers, suggesting a potential dislocation between its fundamental performance and current market price.
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