Heartland Opportunistic Value Equity Strategy: Alphabet (GOOGL) is a Winner - Not A Laggard - When It Comes To AI

Heartland Advisors, an investment management company, released its third-quarter 2025 investor letter for its “Heartland Opportunistic Value Equity Strategy.” A copy of the letter can be downloaded here. In Q3, trends from Q2 continued, with rising optimism about the AI boom and increased electricity demand driving large- and mid-cap growth stocks to new highs, regardless of business model quality or valuation. The strategy returned 4.65% in the quarter, compared to a 5.63% return for the Russell 3000 Value Index. In addition, you can check the fund’s top 5 holdings to determine its best picks for 2025.

In its third-quarter 2025 investor letter, Heartland Opportunistic Value Equity Strategy highlighted stocks such as Alphabet Inc. (NASDAQ:GOOGL). Alphabet Inc. (NASDAQ:GOOGL) is a leading technology company that provides various products and platforms. The one-month return of Alphabet Inc. (NASDAQ:GOOGL) was 13.46%, and its shares gained 83.78% of their value over the last 52 weeks. On December 01, 2025, Alphabet Inc. (NASDAQ:GOOGL) stock closed at $314.89 per share, with a market capitalization of $3.814 trillion.

Heartland Opportunistic Value Equity Strategy stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its third quarter 2025 investor letter:

"Alphabet Inc. (NASDAQ:GOOGL) is another member of the Magnificent 7, but one that has traded at a meaningful discount to the broader market on a debt-adjusted basis since we initiated a position during the depths of COVID-19. We purchased additional shares in 2022 and again this April when, in our opinion, shares were meaningfully undervalued. On almost every metric, GOOGL is a more attractive business than the typical business we analyze.

The stock, which was the top contributor to our Strategy’s performance in the third quarter, rallied on another strong earnings report that provided further evidence that Alphabet is a winner — not a laggard — when it comes to AI, contrary to prevailing views in early 2024. For example, the market has been concerned that competing AI chatbots would cannibalize demand for search, yet Alphabet’s integration of AI-assist into search has stimulated incremental query demand. In addition, GOOGL’s standalone AI assistant, Gemini, was the most downloaded app on iOS in August, overtaking ChatGPT for the first time since the competitor launched in 2022. Given Google’s dominate share of the search engine market and a growing recognition of the company’s AI capabilities, investors are becoming comfortable that GOOGL’s moat remains wide..." (Click here to rad the full text)

Alphabet Inc. (NASDAQ:GOOGL) is in 4th position on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 243 hedge fund portfolios held Alphabet Inc. (NASDAQ:GOOGL) at the end of the third quarter, which was 219 in the previous quarter. 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 buzzing AI stocks on Wall Street. In addition, please check out our hedge fund investor letters Q3 2025 page for more investor letters from hedge funds and other leading investors.

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