At first glance, Alphabet (NASDAQ:GOOG) stock looks not-so-magnificent: shares are down 3% year-to-date and 7.5% over the past month.
Yet GOOG has a lot going for it in early 2026 and has a robust case to be made that the stock is set for a long-term run-up.
It keeps improving its AI offerings, its main business lines are defying Wall Street’s negative consensus and growing rapidly, and the company keeps innovating.
Here are three key factors that should boost GOOG shares this year.
A New Gemini Model
Google announced this week that it is rolling out a new version of its cornerstone AI program, dubbing it Gemini 3.1 Pro. It’s an advancement of the company’s already impressive AI system model that goes deeper, especially in delving into complex tasks rather than offering summary answers to user-prompted questions.
Customers are already on board with the new Gemini rollout, which is being released on company AI platforms, easily found by any of Gemini’s 740 million monthly users.
“Gemini 3.1 Pro represents a clear quality leap in our evaluations,” said Vladislav Tankov, Director of AI, JetBrains, a Netherlands-based AI-powered applications developer. “We observed up to 15% improvement over the best Gemini 3 Pro Preview runs. The model is stronger, faster, which we deem very important, and more efficient, requiring fewer output tokens while delivering more reliable results. These directly translate into better problem-solving and greater confidence for developers working on complex tasks.”
The Numbers Add Up
Google’s Q4 numbers show a technology powerhouse that’s set to thrive in 2026 and beyond. First up is Google Search, which has seemingly confounded Wall Street’s AI-only obsession by growing 17% in the quarter, cementing search as a building block for Google’s future.
Pair that with a 48% run-up in Cloud revenues, basically doubling the platform’s operating income to $5.3 billion, easily outpacing most AI service competitors. Add Waymo’s expansion, with a 2026 commercial rollout not too far away, and it’s easy to see that Google hasn’t lost any of its product development chops. GOOG is set up for the long term in AI as well, with about $185 billion in data center commitments for 2026, indicating ample demand for its AI-fueled product lines.
Google spent $105.7 billion in capex in 2025, signaling a bullish outlook from the company’s C-suite on its AI prospects going forward.
A Big Vision by Management
Alphabet CEO Sundar Pichai isn’t interested in talk of an AI bubble. Instead, he’s backing AI growth, and in a big way.
At a media Q-and-A ahead of the India AI Impact Summit 2026 this week, Pichai ranked the current AI revolution as comparable to an industrial revolution, “but 10 times faster and 10 times larger.” During the talk, Picha made his own case for AI as a business and cultural supernova, emphasizing that Google’s skyrocketing spending on the technology is no luxury. Instead, it’s a necessity.
“We live in a truly global world… [these] investments make sense given the progress in the technology we are seeing and the opportunities on top of it,” Pichai said. That growth capacity is expected to weave its way through Google’s product line for years to come, immersing itself into Google Search, YouTube, Google Cloud, Waymo, and Isomorphic Labs.
A Long-Term Play
Currently, Google shares are moving up the charts in Benzinga’s Edge Stock Rankings, demonstrating steady medium- and long-term price trends, and weighed against short-term challenges.
Trading at $303 per share as of the third week of February, Alphabet has a consensus price target of $356.21 based on the ratings of 39 analysts tracked by Benzinga.
Some analysts are aiming higher with GOOG shares.
Take Canaccord analyst Maria Ripps, who has set a $415 price target on Alphabet shares, representing 37% upside over the next year. Ripps cites stacking revenues that should tamp down investor angst over high AI spending.
“The pace of Cloud deals is showing no signs of slowing, with Google exiting the year with double the new customer velocity compared to Q1, and existing customers are outpacing their initial commitments by over 30%,” she said in a recent research note. “To capitalize on this momentum, Google guided to a step-change increase in FY26 CapEx to $175-185B, roughly double the prior year’s investment.”
In Ripp’s view, a massive expenditure commitment “reflects Google’s strong conviction in the scale of the AI opportunity,” she said.
Canaccord is no outlier.
On February 19, Tigress Financial set a price target of $415.00, expecting GOOGL to rise within 12 months, representing a 34.23% upside on Alphabet shares.
Tigress noted that the company is “increasingly levered to multiple durable growth engines and AI-centric investment trends that continue to drive robust revenue, cash flow, profitability, and increasing shareholder value creation.”
A Great Service Stock
The takeaway on Alphabet shares is that there’s no doubt AI is a technology service powerhouse, and there’s nobody doing better on the technology service demand front than Google right now, and down the road a long way, too.
Getting in now, with Google at a dip, should reward prescient shareholders for years to come.
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