Key Points
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Alphabet’s stock surged nearly 60% in 2025 as investor perceptions shifted, while Amazon seeks similar momentum in 2026.
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Both companies trade at favorable valuations, with forward price-to-earnings ratios below 30.
Alphabet (NASDAQ: GOOGL) had a strong performance in 2025, attributed to advancements in its AI offerings, particularly the Gemini large language model and custom AI chips. The company’s stock saw a remarkable increase of nearly 60%, significantly outpacing Amazon’s modest gains. In contrast, Amazon (NASDAQ: AMZN) experienced slower growth, particularly in its AWS segment, but reported a 20% acceleration in AWS revenue recently and plans to boost capital expenditures to meet rising demand.
Looking ahead, analysts suggest that Amazon has the potential to shift investor perceptions similar to Alphabet’s turnaround. With Amazon’s e-commerce business showing operational improvements and the growing traction of its Trainium chips, there is optimism for a stronger performance in 2026 as AWS continues to evolve. Both stocks offer attractive investment opportunities ahead of 2026.
