NASDAQ · Communication Services

Alphabet Inc.

GOOGL · Internet Content & Information

$368.03

▲ 4.24 (1.17%)

Cached · 10 min

Overall Grade

Defensive

Enterprising

Profitability

A⤢

Gross Profit Margin 62.4%

Operating Margin 36.1%

Net Income Margin 56.9%

Fin. Health

A⤢

Years to Pay Off Debt 1.4 yrs

Working Capital vs Long-Term Debt $25.1B

Working Capital $102.6B

Valuation

F⤢

Margin of Safety 0.0%

Price-to-Book 4.51x

Cash Flow

C⤢

Free Cash Flow $10.1B

CapEx % of Net Income 57.0%

Owner Earnings $104.7B

Profitability

Gross Profit Margin 62.4%

Revenue minus cost of goods sold. Graham's ≥40% threshold identifies businesses with durable pricing power. Note: software and financial companies naturally exceed this; retailers and manufacturers rarely reach it due to their cost structures.

Operating Margin 36.1%

Profit after operating costs before interest and taxes. A consistent ≥15% operating margin signals a business with real competitive advantages. Capital-intensive industries (airlines, auto, commodities) rarely hit this threshold due to their structural cost base — compare within industry for context.

Net Income Margin 56.9%

Bottom-line profit as a percentage of revenue. The ≥20% target reflects Buffett's preference for highly profitable businesses. Financial engineering (buybacks, tax optimisation) can inflate this temporarily — look for consistency across multiple years rather than a single strong result.

Financial Health

Years to Pay Off Debt 1.4 yrs

Total Debt ÷ Net Income. Lower = stronger balance sheet. Important caveat: utilities, telecoms, REITs, and infrastructure companies carry large structural debt by design — their bond-like cash flows service it comfortably at ratios that would alarm Graham. Compare within sector.

Working Capital vs Long-Term Debt $25.1B

Working Capital minus Long-Term Debt. Negative results are common and expected in capital-return-focused businesses like Apple, Domino's, and McDonald's — where aggressive buybacks and dividends intentionally reduce book equity. This does not indicate financial distress in high-FCF businesses.

Working Capital $102.6B

Current Assets minus Current Liabilities. Negative working capital can be a deliberate efficiency strategy in businesses that collect cash before paying suppliers (retailers, fast food franchises, subscription businesses). Assess alongside free cash flow generation for full context.

Cash Flow

Free Cash Flow $10.1B

Operating cash flow minus capital expenditures. Buffett's most important metric — cash a business actually generates for its owners after maintaining and growing its asset base. Consistently positive FCF is one of the strongest indicators of a durable, well-run business regardless of accounting profits.

CapEx % of Net Income 57.0%

Capital expenditure as a share of net income. Low CapEx signals a capital-light business that doesn't need heavy reinvestment to sustain earnings — Buffett's ideal. High CapEx is structurally necessary in manufacturing, airlines, telecoms, and semiconductors. For these industries, a high reading reflects the business model, not poor management.

Owner Earnings $104.7B

Net Income + Depreciation & Amortisation − Capital Expenditures. Buffett's preferred measure of a company's true annual earning power — what could theoretically be distributed to owners without impairing the business. More reliable than reported EPS because it accounts for the capital cost of maintaining the business.

Defensive — Graham's strict criteria (P/B, P/E, dividends, stability) · Enterprising — Profitability & cash flow focused, accepts higher valuations for quality

About Alphabet Inc.

Alphabet Inc. offers various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments. The Google Services segment provides products and services, including ads, Android, Chrome, devices, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube. It is also involved in the sale of apps and in-app purchases and digital content in Google Play and YouTube; and devices, as well as the provision of YouTube consumer subscription services, such as YouTube TV, YouTube Music and Premium, NFL Sunday Ticket, and Google One. The Google Cloud segment offers consumption-based fees and subscriptions for AI solutions, including AI infrastructure, Vertex AI platform, and Gemini enterprise. It also provides cybersecurity, and data and analytics services; Google Workspace that include cloud-based communication and collaboration tools for enterprises, such as Calendar, Gmail, Docs, Drive, and Meet; and other enterprise services. The Other Bets segment sells transportation and internet services. Alphabet Inc. was incorporated in 1998 and is headquartered in Mountain View, California.

Market Data

Market Cap $4,490.9B

Enterprise Value $4,491.3B

P/E (TTM) 28.09

Dividend Yield 0.23%

Exchange NASDAQ

Key Margins

Gross Profit 62.4%

Operating Margin 36.1%

Net Margin 56.9%

Company Info

Sector Communication Services

Industry Internet Content & Information

Employees 194668

Country United States

Visit website

📖

Full Graham Analysis

Mr. Market is currently offering Alphabet Inc. at $368.03.

The business passes only 3 of 7 of Graham's defensive criteria — well below his required standard.

At $368.03, the stock trades at a 280% premium to its Graham Number of $96.86. Graham would consider this price speculative.

There is no margin of safety at the current price. Graham would advise patience and waiting for a better entry point.

Negative NCAV — liabilities exceed current assets. Common in capital-return businesses (buybacks, debt-funded dividends) and capital-intensive industries. Not automatically a warning sign..

Conclusion: By Graham's standards, this stock is speculative at its current price. The intelligent investor would look elsewhere or wait.

Showing Key Metrics

Income Highlights

Metric	Q1 2026	Q4 2025	Q4 2024
Gross Profit %	62.4%▲	59.8%•	N/A
Operating Margin %	36.1%▲	31.6%•	N/A
Net Income %	56.9%▲	30.3%•	N/A
Diluted EPS	5.11▲	2.82•	N/A

Balance Sheet Highlights

Metric	Q1 2026	Q4 2025	Q4 2024
Total Assets	$703.9B	$595.3B	N/A
Total Debt	$90.5B•	N/A•	$22.6B
Working Capital	$102.6B▼	$103.3B•	N/A
Years to Pay Debt	1.45	N/A	N/A

Cash Flow Highlights

Metric	Q1 2026	Q4 2025
Free Cash Flow	$10.1B▼	$24.6B
Owner Earnings	$104.7B	$68.3B
CapEx % of Net Income	57.0%	80.8%

Income Statement

	2026	2025	2024
Tax Effect Of Unusual Items	7,080,508	272,805
Tax Rate For Calcs	0	0
Normalized EBITDA	47,477,000	43,166,000
Total Unusual Items	36,950,000	2,289,000
Total Unusual Items Excluding Goodwill	36,950,000	2,289,000
Net Income From Continuing Operation Net Minority Interest	62,578,000	34,455,000
Reconciled Depreciation	6,482,000	6,040,000
Reconciled Cost Of Revenue	41,271,000	45,767,000
EBITDA	84,427,000	45,455,000
EBIT	77,945,000	39,415,000
Net Interest Income	848,000	911,000
Interest Expense	533,000	298,000
Interest Income	1,381,000	1,209,000
Normalized Income	32,708,508	32,438,805
Net Income From Continuing And Discontinued Operation	62,578,000	34,455,000
Total Expenses	70,200,000	77,895,000
Total Operating Income As Reported	39,696,000	35,934,000
Diluted Average Shares	12,238,000	12,228,000
Basic Average Shares	12,099,000	12,073,000
Diluted EPS	0	0
Basic EPS	0	0
Diluted NI Availto Com Stockholders	62,578,000	34,455,000
Net Income Common Stockholders	62,578,000	34,455,000
Net Income	62,578,000	34,455,000
Net Income Including Noncontrolling Interests	62,578,000	34,455,000
Net Income Continuous Operations	62,578,000	34,455,000
Tax Provision	14,834,000	4,662,000
Pretax Income	77,412,000	39,117,000
Other Income Expense	36,868,000	2,272,000
Other Non Operating Income Expenses	-142,000	69,000
Special Income Charges		-86,000	-87,000
Write Off		86,000	87,000
Earnings From Equity Interest	60,000	-86,000
Gain On Sale Of Security	36,950,000	2,289,000
Net Non Operating Interest Income Expense	848,000	911,000
Interest Expense Non Operating	533,000	298,000
Interest Income Non Operating	1,381,000	1,209,000
Operating Income	39,696,000	35,934,000
Operating Expense	28,929,000	32,128,000
Research And Development	17,032,000	18,572,000
Selling General And Administration	11,897,000	13,556,000
Selling And Marketing Expense	7,606,000	8,215,000
General And Administrative Expense	4,291,000	5,341,000
Other Gand A	4,291,000	5,341,000
Gross Profit	68,625,000	68,062,000
Cost Of Revenue	41,271,000	45,767,000
Total Revenue	109,896,000	113,829,000
Operating Revenue	109,896,000	113,829,000

Balance Sheet

	2026	2025	2024
Ordinary Shares Number	12,116,000	12,088,000
Share Issued	12,116,000	12,088,000
Net Debt	39,438,000	15,839,000
Total Debt	90,484,000		22,574,000
Tangible Book Value	411,528,000	381,885,000
Invested Capital	556,247,000	461,812,000
Working Capital	102,565,000	103,293,000
Net Tangible Assets	411,528,000	381,885,000
Capital Lease Obligations	12,983,000	12,744,000
Common Stock Equity	478,746,000	415,265,000
Total Capitalization	556,247,000	461,812,000
Total Equity Gross Minority Interest	478,746,000	415,265,000
Stockholders Equity	478,746,000	415,265,000
Gains Losses Not Affecting Retained Earnings	-2,180,000	-1,916,000
Other Equity Adjustments	-2,180,000	-1,916,000
Retained Earnings	384,024,000	324,055,000
Capital Stock	96,902,000	93,126,000
Common Stock	96,902,000	93,126,000
Total Liabilities Net Minority Interest	225,173,000	180,016,000
Total Non Current Liabilities Net Minority Interest	113,985,000	77,271,000
Other Non Current Liabilities	11,044,000	8,449,000
Tradeand Other Payables Non Current	12,457,000	9,531,000
Non Current Deferred Liabilities
Non Current Deferred Revenue
Non Current Deferred Taxes Liabilities
Long Term Debt And Capital Lease Obligation	90,484,000	59,291,000
Long Term Capital Lease Obligation	12,983,000	12,744,000
Long Term Debt	77,501,000	46,547,000
Current Liabilities	111,188,000	102,745,000
Other Current Liabilities			6,322,000
Current Deferred Liabilities	7,162,000	6,578,000
Current Deferred Revenue	7,162,000	6,578,000
Current Debt And Capital Lease Obligation			2,887,000
Current Capital Lease Obligation			2,887,000
Current Debt
Other Current Borrowings
Pensionand Other Post Retirement Benefit Plans Current	13,947,000	17,546,000
Payables And Accrued Expenses	90,079,000	78,621,000
Current Accrued Expenses	68,691,000	64,948,000
Payables	21,388,000	13,673,000
Other Payable	631,000	950,000
Total Tax Payable	3,905,000	523,000
Income Tax Payable	3,905,000	523,000
Accounts Payable	16,852,000	12,200,000
Total Assets	703,919,000	595,281,000
Total Non Current Assets	490,166,000	389,243,000
Other Non Current Assets	17,478,000	16,245,000
Non Current Deferred Assets	1,995,000	9,113,000
Non Current Deferred Taxes Assets	1,995,000	9,113,000
Investments And Advances	106,946,000	68,687,000
Investmentin Financial Assets	106,946,000	68,687,000
Available For Sale Securities	106,946,000	68,687,000
Goodwill And Other Intangible Assets	67,218,000	33,380,000
Other Intangible Assets	9,444,000
Goodwill	57,774,000	33,380,000
Net PPE	296,529,000	261,818,000
Accumulated Depreciation	-100,180,000	-98,485,000
Gross PPE	396,709,000	360,303,000
Leases
Construction In Progress
Other Properties	347,937,000	311,955,000
Machinery Furniture Equipment
Buildings And Improvements	48,772,000	48,348,000
Land And Improvements
Current Assets	213,753,000	206,038,000
Other Current Assets	23,914,000	16,309,000
Receivables	62,999,000	62,886,000
Accounts Receivable	62,999,000	62,886,000
Allowance For Doubtful Accounts Receivable	-962,000	-924,000
Gross Accounts Receivable	63,961,000	63,810,000
Cash Cash Equivalents And Short Term Investments	126,840,000	126,843,000
Other Short Term Investments	88,777,000	96,135,000
Cash And Cash Equivalents	38,063,000	30,708,000
Cash Equivalents	22,655,000
Cash Financial	15,408,000

Cash Flow

	2026	2025
Free Cash Flow	10,116,000	24,551,000
Repurchase Of Capital Stock	0	-5,499,000
Repayment Of Debt	-1,477,000	-6,333,000
Issuance Of Debt	31,379,000	26,562,000
Capital Expenditure	-35,674,000	-27,851,000
End Cash Position	38,063,000	30,708,000
Beginning Cash Position	30,708,000	23,090,000
Effect Of Exchange Rate Changes	-123,000	-36,000
Changes In Cash	7,478,000	7,654,000
Financing Cash Flow	25,077,000	7,028,000
Cash Flow From Continuing Financing Activities	25,077,000	7,028,000
Net Other Financing Charges	3,200,000	0
Proceeds From Stock Option Exercised	-5,483,000	-5,166,000
Cash Dividends Paid	-2,542,000	-2,536,000
Common Stock Dividend Paid	-2,542,000	-2,536,000
Net Common Stock Issuance	0	-5,499,000
Common Stock Payments	0	-5,499,000
Net Issuance Payments Of Debt	29,902,000	20,229,000
Net Long Term Debt Issuance	29,902,000	20,229,000
Long Term Debt Payments	-1,477,000	-6,333,000
Long Term Debt Issuance	31,379,000	26,562,000
Investing Cash Flow	-63,389,000	-51,776,000
Cash Flow From Continuing Investing Activities	-63,389,000	-51,776,000
Net Other Investing Changes	-996,000	-525,000
Net Investment Purchase And Sale	6,902,000	-23,233,000
Sale Of Investment	38,849,000	22,110,000
Purchase Of Investment	-31,947,000	-45,343,000
Net Business Purchase And Sale	-33,621,000	-167,000
Purchase Of Business	-33,621,000	-167,000
Net PPE Purchase And Sale	-35,674,000	-27,851,000
Purchase Of PPE	-35,674,000	-27,851,000
Operating Cash Flow	45,790,000	52,402,000
Cash Flow From Continuing Operating Activities	45,790,000	52,402,000
Change In Working Capital	-1,402,000	4,707,000
Change In Other Working Capital	8,606,000	-2,123,000
Change In Other Current Assets	-3,403,000	-482,000
Change In Payables And Accrued Expense	-6,242,000	12,509,000
Change In Accrued Expense	-6,002,000	7,539,000
Change In Payable	-240,000	4,970,000
Change In Account Payable	-240,000	1,678,000
Change In Receivables	-363,000	-5,197,000
Changes In Account Receivables	-363,000	-5,197,000
Other Non Cash Items	1,265,000	1,265,000
Stock Based Compensation	6,751,000	7,071,000
Deferred Tax	6,920,000	1,218,000
Deferred Income Tax	6,920,000	1,218,000
Depreciation Amortization Depletion	6,482,000	6,040,000
Depreciation And Amortization	6,482,000	6,040,000
Depreciation	6,482,000	6,040,000
Operating Gains Losses	-36,804,000	-2,354,000
Gain Loss On Investment Securities	-36,804,000	-2,354,000
Net Income From Continuing Operations	62,578,000	34,455,000

📊 Quarterly mode — Graham Fair Value & 7 Criteria require annual data. Switch to Annual for full analysis.

Quarter vs Same Quarter Last Year

YoY strips seasonality

Revenue Growth (YoY)

Prior year: $90.2B ▲ $109.9B +21.8%

Revenue growth vs same quarter last year strips seasonality. Consistent double-digit growth is a Buffett hallmark.

Gross Margin

Prior year: 59.7% ▲ 62.4% +2.7pp

Buffett: consistent gross margin above 40% signals durable pricing power and competitive moat.

Operating Margin

Prior year: 44.0% ▲ 36.1% -7.9pp

Graham: operating margin reflects true business economics before financing. Trend matters as much as level.

Net Margin

Prior year: 38.3% ▲ 56.9% +18.7pp

Net margin can be distorted by one-time items, tax timing, or interest costs — compare to operating margin for signal quality.

Quarterly Health Checks

3 Graham/Buffett criteria that are valid and reliable on quarterly data

✅ Adequate Size

Graham required scale for resilience. Quarterly revenue × 4 gives an annualised proxy.

$109.9B/qtr (≈$439.6B ann.)

vs > $1.5B annualised revenue

❌ Financial Condition

Current assets vs current liabilities — a real-time liquidity snapshot. Valid and reliable on quarterly data.

1.92x current ratio

vs ≥ 2.0x

✅ Free Cash Flow

Buffett's most important single metric. A positive FCF quarter means the business generated real cash for owners after maintaining its asset base.

$10.1B

vs Positive

Operating Cash Flow

$45.8B

Latest quarter · Buffett's cash reality check

ROIC

5.3%

Based on latest annual operating income

Return on Invested Capital — Buffett's preferred measure for asset-light businesses. ROIC > 15% consistently signals a durable competitive advantage (moat). More meaningful than P/B for software, pharma, and consumer brand companies where most value is intangible and off-balance-sheet.

Market Cap / Net Assets

4.5x

Net Assets: $478.7B

Asset Context — Internet Content & Information

Platform and internet businesses derive value from network effects, user data, and brand — intangibles that accounting rules don't capitalise. A low or negative Net Assets figure is expected and not a risk signal. ROIC and FCF per share are more relevant valuation anchors.

⚠️ Revenue grew vs prior year but operating margin contracted. Possible explanations: deliberate investment in growth (hiring, marketing, R&D), input cost inflation, or pricing pressure from competition. Buffett distinguishes between spending that builds moat vs. spending that doesn't.

Peers & Industry Comparison

Internet Content & Information — Auto-detected peers

Company	Price	Market Cap	P/E	Gross Margin	Net Margin	Revenue
GOOGL	$368.03	$4,490.9B	28.09	62.4%	56.9%	$109.9B
META Meta Platforms, Inc.	$577.22	$1,465.2B	21.0	81.9%	32.8%	$215.0B
SNAP Snap Inc.	$4.66	$7.7B	N/A	55.8%	-6.7%	$6.1B
PINS Pinterest, Inc.	$20.27	$11.4B	42.2	79.9%	7.6%	$4.4B

"The management of a business is its most important single factor — more important than market position, patents, or financial structure."

— Benjamin Graham

Capital Allocation & Alignment

Insider Ownership

1.18%

Low — management has little skin in the game

Return on Equity (ROE)

13.1%

Adequate — returns are moderate

Return on Assets (ROA)

8.9%

Strong — management uses assets efficiently

Share Buybacks (Latest Year)

$45.7B

Management is returning capital to shareholders via buybacks

Leadership Team

Sundar Pichai

CEO & Director

Age 52

Pay: $10,906,079

0.017% of net income

Ruth Porat

President & Chief Investment Officer

Age 67

Pay: $1,015,596

0.002% of net income

Lawrence Edward Page II

Co-Founder & Director

Age 52

Pay: $1

0.000% of net income

Sergey Brin

Co-Founder & Director

Age 51

Pay: $1

0.000% of net income

Anat Ashkenazi

Senior VP & CFO

Age 52

Pay: $1,087,961

0.002% of net income

Top Institutional Holders

Institution	% Owned	Shares
Blackrock Inc.	7.67%	446,980,992
Vanguard Capital Management LLC	6.49%	378,261,579
FMR, LLC	4.06%	236,544,675
State Street Corporation	3.88%	226,259,132
Geode Capital Management, LLC	2.61%	151,888,094
Morgan Stanley	2.08%	120,955,598
Vanguard Portfolio Management LLC	1.66%	96,536,714
Price (T.Rowe) Associates Inc	1.38%	80,506,798

Risk Analysis

Beta (Market Risk)

1.24

Moderate volatility — moves slightly more than market

Short Interest

1.4% of float

Low short interest — market is not heavily bearish

Debt-to-Equity

0.20x

Conservative balance sheet — low financial risk

Current Ratio

1.92x

Adequate liquidity

52-Week Price Range

Low: $162.00 Current: $368.03 High: $408.61

Currently at 84% of 52-week range

Alphabet Inc.

Metric Explanations

Full Graham Analysis

Income Highlights

Balance Sheet Highlights

Cash Flow Highlights

Quarter vs Same Quarter Last Year

Quarterly Health Checks

Operating Cash Flow

ROIC

Market Cap / Net Assets

Peers & Industry Comparison

Capital Allocation & Alignment

Leadership Team

Top Institutional Holders

Risk Analysis