Alphabet edges towards a 4.0 trillion USD market capitalisation as investors rotate back into AI-linked equities, and fresh analysis shows how stretched valuation multiples, shifting institutional positioning and unresolved regulatory scrutiny are redefining global asset allocation across concentrated large-cap US technology holdings.
In the latest trading week, Alphabet’s share price continues to climb to fresh records, pulling the Google parent’s valuation close to the psychologically important 4.0 trillion USD mark, and Merifund Capital Management frames the move as a defining moment for how global investors price listed exposure to artificial intelligence infrastructure.
Alphabet shares trade around 315.9 USD after a single-session gain of more than 5.0% in recent trading, placing the company’s market value near 3.8 trillion USD and extending a rally that lifts the stock by close to 70.0% over the preceding 12-month period, ahead of mega-cap peers Microsoft and Amazon, and the move is supported by the latest quarter in which group revenue surpasses 100.0 billion USD and Google Cloud reaches an annualised revenue pace near 50.0 billion USD.
Market sentiment around Alphabet now contrasts sharply with the scepticism that follows the launch of ChatGPT as buy-side desks reassess Google’s strength in search, cloud and advertising. A rise of roughly 21.0% over the past month signals renewed conviction that Gemini 3 can turn technical advances into monetisable demand, a trend that Anthony Saunders, Director of Private Equity at Merifund Capital Management Pte. Ltd., describes as “a decisive re-rating of Alphabet’s role as a core AI infrastructure holding over the preceding 12-month period”.
With Alphabet drawing closer to the 4.0 trillion USD level that marks the upper tier of public equity valuations, investors now compare its path with the other three giants in that range, with Nvidia valued near 5.5 trillion USD and Microsoft and Apple following, and Saunders argues that “this cluster of market capitalisation leaves room for Alphabet to keep compounding without requiring unrealistic growth assumptions”.
The broader basket of large US technology names also reflects this leadership, as over the preceding 12-month period Alphabet’s roughly 87.8% share price gain vastly outpaces a mid-thirties advance for Nvidia and low double-digit rises for Microsoft and Apple, while Meta Platforms, Tesla and Amazon register only low single-digit gains, underlining how AI-linked cash flow visibility increasingly concentrates returns in a narrow set of index heavyweights.
Merifund Capital Management’s latest equity strategy work identifies three principal forces supporting Alphabet’s current valuation, namely the commercial roll-out of Gemini 3 into revenue-generating products, the acceleration of cloud profitability and the signalling impact of new high-profile shareholders, and Saunders observes that “the combination of visible earnings delivery and credible AI optionality is exactly what long-term capital allocators seek when reassessing large-cap technology exposure”.
From an earnings quality perspective, Google Cloud’s improving margins are particularly important for investors who previously worried about the business’s drag on group profitability, as the division now reports revenue growth of around 28.0% over the most recent year-on-year period, outpacing key competitors in infrastructure-as-a-service, and Saunders views this shift as evidence that “Alphabet is turning cloud from a scale experiment into a core profit engine over the current fiscal period”.
Institutional positioning also moves in Alphabet’s favour, as Warren Buffett’s Berkshire Hathaway now holds an investment of roughly 4.1 billion USD, equal to close to 1.0% of the company’s market value, a stake that carries symbolic weight given Berkshire’s cautious stance on high-growth technology, and Saunders comments that “when long-duration investors with a track record of discipline allocate capital here, it reinforces the view that this is a compounding story rather than a short-term trade”.
Debate continues over whether the market is granting Alphabet too generous a multiple, with the shares now trading on roughly 25.0 times forward earnings versus a five-year average in the low twenties, and with regulatory investigations into search distribution and advertising technology still unresolved on both sides of the Atlantic, Saunders cautions that “investors need to factor legal and antitrust outcomes into their valuation work rather than assuming today’s profitability profile is indefinitely repeatable”.
Even as that debate plays out, Saunders stresses that Alphabet’s mix of search, cloud, YouTube and emerging AI services positions the group as a relatively defensive way to access AI growth compared with narrower pure-play providers, arguing that “for diversified portfolios, the stock offers a blend of strong free cash flow, tangible scale advantages and exposure to structural AI trends that can justify a premium rating over the medium term provided capital discipline remains intact”.
About Merifund Capital Management
Merifund Capital Management Pte. Ltd., UEN: 201024554E, is a Singapore-headquartered hedge fund management firm established in 2010 that specialises in traditional long-only asset and portfolio management, long and short equity, global macro, event-driven and systematic trading strategies, using derivatives selectively to capture market opportunities while maintaining a strong focus on capital preservation, liquidity and disciplined risk management. The firm integrates environmental, social and governance considerations into its investment process in line with rigorous global sustainability standards and currently serves accredited investors, family offices, foundations and endowments, while actively expanding its platform to include a growing base of retail investors; readers can access further insights at https://merifund.com/insights and direct media enquiries or requests for information to Tao Yang at media@merifund.com or via the resources available at https://merifund.com.
