Google stock is outperforming the rest of the 7 hottest stocks — here’s why

The alphabet has its back groove.

Shares of Alphabet (GOOG, GOOGL) rose nearly 4% in Wednesday afternoon trading, outperforming the Magnificent Seven Index as technology stocks found some support after days of declines. The gains have sent Alphabet shares up about 55% since the beginning of the year, nearly 20 percentage points better than the second-best Mag 7 performer, Nvidia (NVDA). At midway through the year, he was in the red.

Technology stocks have been under pressure this month on concern about the sector’s heavy investments in artificial intelligence, but Alphabet is bucking the trend: Heading into Wednesday’s session, Mag 7 was the only stock up since the start of November.

Two developments have helped push the stock higher recently. Alphabet on Tuesday released Gemini 3, the latest version of its flagship artificial intelligence model. Executives at Google DeepMind, the company’s artificial intelligence unit, called Gemini 3 “the world’s best model for multimedia understanding and our most powerful, dynamic coding model to date.”

“I was impressed with it,” Ben Ritz, head of technical research at Milius, said of Gemini 3 during an appearance on the podcast. CNBC Wednesday. “I think it’s a big leap over previous models.” Investors were likely surprised by Alphabet’s claim yesterday that the Gemini app has more than 650 million monthly users, indicating a strong competitive position, Ritzes said.

Alphabet stock also got a boost earlier this week from an unexpected source. Berkshire Hathaway ( BRK.B ) revealed it made a rare bet on technology by investing nearly $5 billion in Alphabet last quarter, tying the stock to legendary investor and longtime CEO Warren Buffett, who is stepping down at the end of the year.

What does Wall Street think of Google stock now?

The AI ​​rally has stalled in recent weeks amid concerns about overvaluation of technology stocks and unsustainable infrastructure spending. Some investors fear that future demand for artificial intelligence will fail to meet Silicon Valley’s expectations, leaving tech companies like Microsoft (MSFT), Amazon (AMZN), Meta (META), and Oracle (ORCL) with an abundance of data center capacity and possibly mountains of debt. These concerns have led some to bet against big technology stocks.

Alphabet’s earnings report at the end of October may have eased some of these concerns, at least as far as Google is concerned. Alphabet raised its full-year investment forecasts for the third time this year, and reported that growth has accelerated across the company. The results confirmed to some investors that artificial intelligence, contrary to expectations, is enhancing Google’s core search business.

Experts are generally optimistic about the outlook for Alphabet stock. Twelve of the fifteen analysts with current ratings tracked by Visible Alpha recommend the stock as a Buy, and the rest rate it as a Hold. The average price target of $324 suggests an upside of approximately 14% from Tuesday’s close.