Alphabet vs. Apple: Which Warren Buffett Favorite Is the Better Buy Right Now?

Although Warren Buffett no longer heads Berkshire Hathaway, its stock trades and positions continue to attract plenty of attention. At one time, nearly half of the conglomerate's massive stock portfolio consisted of its stake in Apple (NASDAQ: AAPL), and though it has sold a large number of shares, the iPhone maker remains its largest equity position.

More recently, Berkshire has been adding to its position in Google parent Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG), even as the conglomerate continues to increase its liquidity by selling other companies' shares. Still, that position remains much smaller than its Apple holdings, and Buffett has publicly said he sold Apple "too soon." Despite that admission, Alphabet is likely the better buy among these two "Magnificent Seven" stocks right now, and here's why.

Image source: The Motley Fool.

Comparing Apple and Alphabet

Apple now makes up around 21% of Berkshire's portfolio, significantly above the approximately 8% of the portfolio it now has invested in Alphabet.

Moreover, investors have plenty of reasons to like Apple. For one, it has outperformed Alphabet so far in 2026 as a device upgrade cycle, particularly with the iPhone, has helped accelerate its revenue growth.

AAPL data by YCharts.

Nonetheless, Alphabet has delivered higher shareholder returns than Apple over the past one-year and five-year periods. Also, Berkshire Hathaway's most obvious indication as to whether it prefers Alphabet or Apple is its recent activity. Over the last year, it sold more than 52 million Apple shares, and that came after selling more than 600 million shares in prior quarters. That took its position down to around 228 million shares.

In contrast, Berkshire had never traded Alphabet until the third quarter of 2025, when it made its first buy. It purchased more shares in 2026's first quarter, and then announced in June that it had invested $10 billion more in the company in the second quarter via a private placement, buying those shares directly from Alphabet. Analysts now believe it holds more than 86 million Alphabet shares. Buffett later said that he was behind Berkshire's decision to invest in Alphabet.

Furthermore, Alphabet has become the more prominent AI innovator of these two, particularly with the success of Google Gemini and the market leadership of Waymo in the emerging autonomous vehicle market. In contrast, Apple appears to have little interest in getting involved in the AI infrastructure race, and has signed deals to run its next-generation Apple Foundation Models on the Google Cloud platform.

Despite its competitive advantages, Alphabet has offered investors a more attractive valuation in recent months. It trades at 25 times trailing earnings, well below the Apple price-to-earnings ratio (P/E) of 39. And the Google parent's earnings multiple had fallen to as low as 19 in July last year, giving Berkshire all the more reason to begin buying the stock when it did.

Choose Alphabet over Apple

As Berkshire Hathaway's recent behavior confirms, Alphabet is likely the better buy right now, although the iPhone's continued strength and its current upgrade cycle give Berkshire a compelling incentive to hold Apple stock.

However, over the last year, it is also clear that Berkshire expressed its preference by selling Apple shares and buying Alphabet stock. Moreover, the latter trades at a lower P/E despite Apple's decision to use the Google parent's AI platform.

Thus, investors contemplating this question should probably take their cues from Berkshire's actions and choose Alphabet's stock over Apple's.

Will Healy has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Alphabet, Apple, and Berkshire Hathaway. The Motley Fool has a disclosure policy.