Giverny Capital Asset Management Trimmed Alphabet (GOOGL) in Q3

Giverny Capital Asset Management Trimmed Alphabet (GOOGL) in Q3 Soumya Eswaran Wed, July 22, 2026 at 2:36 PM GMT+2 3 min read ^GSPC GOOG GOOG Giverny Capital Asset Management, LLC , an investment management company, recently published its second-quarter 2026 investor letter. A copy of the letter can be downloaded here . The model portfolio returned 13.

70% this quarter, compared to the S&P 500's 15. 20% return. YTD, the portfolio gained 5.

89%, while the index increased by 10. 21%. The long-term link between stock appreciation and earnings growth is strong; Benjamin Graham described the market as a "voting machine" in the short term and a "weighing machine" in the long term.

Despite the S&P 500's 10. 2% rise in the first half of the year, 210 stocks lost value, indicating market anomalies. High-quality earnings compounders that benefit from AI capabilities are likely to maintain their competitive edge.

Recently, the market has increasingly chased momentum. Tech giants are taking advantage of the optimism of investors amid fears of an AI bubble. Despite strong profit margins, reliance on "moonshot" investments raises sustainability concerns.

The author recommends investing in both emerging tech leaders and established firms. In addition, please check the Strategy's top five holdings to know its best picks in 2026. In its Q2 2026 investor letter, Giverny Capital Asset Management highlighted Alphabet Inc.

(NASDAQ: GOOGL ). Alphabet Inc. (NASDAQ:GOOGL), the parent company of Google, offers various platforms and services, including online search and advertising, cloud solutions, and artificial intelligence, and is a significant contributor to the Strategy's performance.

On July 21, 2026, Alphabet Inc. (NASDAQ:GOOGL) closed at $347. 15 per share, reflecting a market capitalization of $4.

22 trillion. Alphabet Inc. (NASDAQ:GOOGL) posted a one-month return of 0.

54%, while its shares gained 82. 49% over the past 52 weeks. Giverny Capital Asset Management stated the following regarding Alphabet Inc.

(NASDAQ:GOOGL) in its Q2 2026 investor update: "Our two largest positions are Alphabet Inc. (NASDAQ:GOOGL) and Arista, which I believe have strong positions in the emerging AI economy. Alphabet has a near monopoly in search, a robust cloud data center business, a leading computer chip used in AI data centers, a highly profitable asset in YouTube and the premier autonomous driving platform in Waymo.

It has built a tremendous collection of assets. As for portfolio activity for the quarter, we trimmed Alphabet and Arista. We sold 17% of our position in Alphabet in April at about $380.

Management subsequently sold $80 billion of stock in a secondary offering at $350 to raise money to fund more investment in data centers. I feel we did the responsible thing in trimming Alphabet as it got to nearly 12% of our portfolio. Arista and Alphabet remain our largest positions as of June 30.

The valuations on both are high enough that future returns likely will be lower than we're used to, even if the businesses continue to grow. " Story Continues Alphabet Inc. (NASDAQ:GOOGL) ranks third on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026 .

According to our database, 265 hedge fund portfolios held Alphabet Inc. (NASDAQ:GOOGL) at the end of the first quarter, compared to 288 in the previous quarter. In 2025, Alphabet Inc.

(NASDAQ:GOOGL) achieved  its first-ever $400 billion annual revenue and in Q1 2026 its consolidated  revenue reached $109. 9 billion, up 22% or 19% in constant currency. While we acknowledge the potential of Alphabet Inc.

(NASDAQ:GOOGL) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock . In  another article , we covered Alphabet Inc.

(NASDAQ:GOOGL) and shared the list of best quantum computing stocks to buy and hold forever. In addition, please check out our hedge fund investor letters Q2 2026  page for more investor letters from hedge funds and other leading investors. READ NEXT:  33 Stocks That Should Double in 3 Years  and  15 Stocks That Will Make You Rich in 10 Years .

Disclosure: None. This article is originally published at Insider Monkey.