ClearBridge Large Cap Growth Strategy’s Views on Alphabet (GOOG)

Core Insights - ClearBridge Investments released its fourth-quarter 2025 investor letter for the ClearBridge Large Cap Growth Strategy, emphasizing an investment philosophy focused on undervalued leading companies with growth potential [1] - Large-cap stocks showed strength in the quarter, driven by strong earnings from mega-cap companies and enthusiasm for generative AI, although the ClearBridge strategy underperformed the Russell 1000 Growth Index by approximately 900 basis points for the year [1] - The underperformance was attributed to underweight exposure to mega-cap AI beneficiaries and lower-quality AI-related names [1] Company Highlights - Alphabet Inc. (NASDAQ:GOOG) was highlighted as a key stock, with a market capitalization of $3.89 trillion and a one-month return of 2.78%, while shares gained 65.02% over the last 52 weeks [2] - The company achieved its first-ever $100 billion in revenue in the third quarter of 2025, indicating strong financial performance [4] - ClearBridge noted that it did not increase its positions in Alphabet Inc. enough, despite its strong performance driven by the success of the Google Gemini chatbot and TPU chips for AI workloads, which boosted shares by more than 60% for 2025 [3] Investment Strategy - ClearBridge acknowledged the potential of Alphabet Inc. as an investment but suggested that certain AI stocks may offer greater upside potential with less downside risk [4] - The firm expressed regret for not scaling up its positions in Alphabet Inc. after the conclusion of the DOJ antitrust case, which resulted in less severe penalties than anticipated [3]