Alphabet (NASDAQ:GOOGL | GOOGL Price Prediction) surpassed the $4 trillion market cap mark and could be headed to a $5 trillion valuation at some point in 2026, especially if the latest parabolic move has gas in the tank. With shares of Alphabet hitting new highs on Tuesday’s session, effectively leaving many of its Magnificent Seven peers behind, questions linger as to whether the AI search giant can continue its relative outperformance or if it’s destined for a year of lackluster results as investors digest the new, higher multiple on the stock.
After the latest upside surge, shares of GOOGL trade at 33.2 times trailing price-to-earnings (P/E). That’s high for Alphabet standards, but, then again, the company deserves to go for a premium, given its AI dominance and the new markets it can break into with the power of Gemini.
Gemini 3.0 was a game-changer. The ball remains in OpenAI’s court
Gemini 3.0 is a massive upgrade, to say the least, and it should have OpenAI staying on its toes. Even with OpenAI hitting the “Code Red” button while pushing ChatGPT-5.2 out of the gate in direct response, it still feels like all the momentum is behind Google and Gemini.
Now, OpenAI still has more market share, but with Gemini gaining momentum, it feels like ChatGPT stands to bleed out users to Google Gemini. While OpenAI has done some great things in recent months with GPT-5.1 and 5.2, with reportedly fewer hallucinations, better visual reasoning (that’ll be big once physical AI and robotics take off), and the real-time router system, GPT-5.2 still might not be a big enough leap to win back recent switchers who jumped over to Gemini since the launch of 3.0.
With Apple (NASDAQ:AAPL) recently announcing it’ll be going with Gemini for its Siri overhaul, it really does feel like OpenAI has been dethroned. Dan Ives of Wedbush Securities views the Gemini-Siri deal as a “golden partnership,” and I couldn’t agree more. In the meantime, the future of the Apple-OpenAI partnership remains a giant question mark.
In any case, ChatGPT will need GPT-6 to be a game-changer if it’s to effectively play defense against Google and Gemini, which is moving ahead at an absurd pace. Either way, even after the release of GPT-5.2, the ball remains in OpenAI’s court, in my view. And it needs a big response.
Alphabet stock has had a run. But shares are still cheaper than most of its Mag Seven peers
While shares of Alphabet do seem unstoppable, many pundits across Wall Street aren’t yet ready to turn away from the stock. Mad Money host Jim Cramer remains a bull on Alphabet shares after an incredible 2025: “I think Alphabet goes straight shot to $400.”
Even amid AI bubble concerns, I think Cramer will be proven right. The stock may very well be unstoppable and too cheap, given the tailwinds to come.
Even with a more than $4 trillion valuation, Alphabet stock goes for a similar P/E multiple as its peers in the Mag Seven. Apple, Amazon (NASDAQ:AMZN), and Microsoft (NASDAQ:MSFT) are all a bit pricier when it comes to P/E, which, I think, makes very little sense, given recent momentum behind Gemini might suggest that Alphabet is running the AI ball into the endzone.
Add its TPU dominance into the equation, as well as its fast-growing Google Cloud Platform, as well as all the businesses that could come to be at the hands of AI (not just Waymo but various health projects as well), and it’s looking like Google might end up owning the entire stack if Gemini pulls further away with the lead.
Lots of drivers to look forward to
Up ahead, I’d look for Waymo and the Boston Dynamics partnership with Google DeepMind to give it a flying start as more attention shifts from AI models to physical AI and applied AI.
Add the potential for further partnerships (like the big one with Apple) into the equation, and perhaps Google could be on the cusp of a significant growth re-acceleration. While it’s soon to refer to Google and Alphabet as the next Nvidia (NASDAQ:NVDA), I do think Alphabet will lead the Mag Seven once again in 2026.
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