According to prediction market traders, Alphabet's (GOOGL) Google is the clear favorite to own the best artificial intelligence (AI) model at the end of October. On Polymarket, as of Oct. 12, Google held about a 70% chance ahead of Anthropic at 23%, Meta Platforms (META) at 3.5%, and OpenAI at below 1%. Rival platform Kalshi showed a nearly identical picture.
The shift happened fast. Until late September, Anthropic was the overwhelming favorite on Polymarket with odds near 90%. That flipped almost overnight on Sept. 30, when Google unveiled Gemini 4 Argon, its first major new model in months. Google said Argon beat rival models from OpenAI and Anthropic on 13 of 19 benchmarks. It also took the top spot on Arena’s text leaderboard, a popular public ranking.
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A Lead Built on a Model Few Can Use
Here's the catch, though. Hardly anyone can use Argon yet. Google is limiting access to a small group of vetted cybersecurity partners. At launch, Google didn’t share a timeline for a broader release, which makes its lead somewhat fragile.
I think the real test will come when Argon reaches paying customers. Google Cloud revenue grew 82% last quarter, and having a top model is one of the strongest ways to keep that going. As I have covered previously, a stronger Gemini also matters beyond the cloud, since Alphabet is building AI into the core of products like its new Googlebook laptop. Still, investors haven’t fully bought in yet; GOOGL stock fell in the three months before the launch as investors weighed the company's heavy AI spending.
About Alphabet Stock
Alphabet is the parent company of Google, whose products include Search, YouTube, Android, Chrome, and Google Cloud. It also develops the Gemini family of AI models, including its newest model, Gemini 4 Argon. Google was founded in 1998, and Alphabet is headquartered in Mountain View, California.
Over the last 12 months, GOOGL stock has climbed about 35%, well ahead of the S&P 500’s ($SPX) 16% gain. Much of that rise came between late March and May, when strong first-quarter results sent shares to a 52-week high of $408.61. The stock has since pulled back to around $340 as investors have weighed Alphabet’s rising AI spending.
Alphabet now trades at a forward price-to-earnings (P/E) ratio of 17 times and a price-to-sales (P/S) ratio of 10.6 times, which is higher than its norm. That premium tells me the market already expects the company's AI investments to pay off.
Analysts’ EPS estimates swing sharply, with earnings expected to jump about 90% in fiscal 2026 before falling 27% in fiscal 2027. That's because large one-time investment gains are inflating this year's profit. Meanwhile, the balance sheet is one of Alphabet's strongest aspects, with the company holding about $121 billion more cash than debt. For investors, Argon’s broader release could go a long way in deciding whether the premium holds.
www.barchart.com Google Cloud Accelerates 82% as AI Spending Climbs
Alphabet reported Q2 fiscal 2026 earnings on July 22. Revenue rose 24% to $119.8 billion, ahead of the roughly $116.9 billion analysts expected. Diluted EPS jumped to $9.11, largely due to about $98 billion in investment gains. Excluding those gains, EPS was $2.85, just below the $2.89 per share analysts expected. Google Cloud led the way, with revenue surging 82% year-over-year (YOY) to $24.8 billion.
Alphabet will report Q3 results on Oct. 28. The company doesn't give quarterly earnings guidance, but management said demand for its cloud capacity still outpaces supply. Google Cloud revenue will again be a key number to watch. Google Cloud backlog grew to $514 billion last quarter, with just over half expected to become revenue within two years. Investors will also want updates on spending. Alphabet raised its 2026 capital spending forecast to $195 billion to $205 billion and said that 2027 spending will climb even further.
What Do Analysts Expect for Alphabet Stock?
Based on 52 Wall Street analysts with coverage, Alphabet holds a consensus “Strong Buy” rating with a mean price target of $432.75, indicating potential upside of 27% from here. Out of those analysts, not one recommends selling the stock, with 46 “Strong Buy” ratings, three “Moderate Buy” ratings, and four “Hold” ratings. Moreover, even the lowest price target of $350 is marginally higher than the current share price. This shows that Wall Street remains largely bullish on GOOGL stock.
www.barchart.com On the date of publication, Jabran Kundi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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