Apple vs. Alphabet: Gemini Powers Siri, but Only One Stock Still Looks Cheap

Big Tech doesn’t stay on top by standing still.

Artificial intelligence is reshaping nearly everything in technology, and it is growing faster than the internet did. Today, most companies are adopting AI in their workflows as people rely on it more and more. But for income-focused investors, that innovation is only half the story. The bigger question is how much of that success actually reaches shareholders. That is what makes Apple (AAPL) and Alphabet (GOOGL) such an interesting matchup, since both are AI titans, but which one offers a better balance between technology and shareholder value? Let’s start with Apple.

Apple’s New CEO, Foldable iPhone, and Gemini-Powered Siri

Apple is best known for the iPhone and the Apple ecosystem, which brings together advanced technology, data management, and artificial intelligence. Now, the tech giant is starting a fresh chapter under CEO John Ternus, who recently succeeded Tim Cook. Apple also just unveiled the iPhone Duo, its first foldable phone, which kills two birds with one stone: it opens more room for innovation and answers users looking for something new. On top of that, the company rolled out a more capable Siri, built in collaboration with Google’s Gemini technology. That partnership puts the spotlight on Alphabet.

Alphabet’s Bigger AI Ambitions Go Beyond Siri

Alphabet is already bringing AI into Google Search and YouTube, while Google Cloud offers another way to bring it to businesses. That is exactly the goal of the new Gemini agent, an AI tool designed to work across business applications and systems. This could open another growth opportunity for Alphabet. Meanwhile, Apple is investing in its existing product lines, while Alphabet is spending heavily on AI infrastructure to meet growing power demands. But how do these different approaches show up in the financials?

Apple vs. Alphabet: Growth, Earnings, and Valuation Compared

Financials tell the objective story, so I used Barchart’s Stock Comparison Tool to see how the two stack up:

Apple is the bigger company, with a market cap of $5.02 trillion versus Alphabet’s $3.87 trillion. But Alphabet’s latest quarterly sales grew 24.2% year over year to $119.8 billion, outpacing Apple’s 16.4% increase to $109.4 billion. Alphabet’s lead holds over the long term too, with sales up 120.7% over the past five years, more than double Apple’s 51.6%.

Net income looks similar at first glance. Apple’s rose 27.1% year over year to $29.8 billion, while Alphabet’s jumped 297.9% to $112.2 billion. That huge gap is driven largely by roughly $98 billion in investment gains, so it overstates Alphabet’s underlying earnings power.

Valuation tips the scales further in Alphabet’s favor. Its stock trades at 15.55x forward earnings, well below Apple’s 36.23x. The same goes for price-to-cash-flow, where Alphabet trades at 25.27x compared with Apple’s 41.53x, making it the cheaper stock on both counts. So Alphabet is winning the scorecard, but one more metric could turn the tables for Apple: dividends.

Which Pays More Dividends: Apple or Alphabet?

Neither company is particularly known for dividends, but here is what each offers. Apple pays a forward annual dividend of $1.08 per share, for a yield of about 0.31%. Its payout ratio is about 12.4%, meaning only about a tenth of earnings go to dividends. Meanwhile, Alphabet pays $0.88 annually, for a yield of roughly 0.27%. Its payout ratio is even lower, around 4.4%, though that figure is skewed by unusually large investment gains. With the income picture this thin on both sides, the analyst view matters more. So how does Wall Street see the two stocks from here?

How Wall Street Rates Apple and Alphabet Stock Today

A consensus of 40 analysts rates Apple a “Moderate Buy,” with high target prices suggesting about 15% upside over the next year. 

Wall Street is clearly more bullish on Alphabet, though, with 53 analysts rating it a “Strong Buy.” Its high target prices imply about 61% upside if achieved. With the numbers and analyst views in hand, which stock deserves the nod?

Verdict: Why Alphabet Edges Out Apple for Investors

Apple and Alphabet are two of the world's biggest companies and could easily survive the next 20, or even 50, years. Both are benefiting from the AI boom, so the question is which offers better rewards. For now, Alphabet is more convincing, with stronger growth, a cheaper valuation, and a massive AI footprint. Apple looks better on yield, but the gap isn’t wide enough to make a strong case for it as the better investment, especially after Alphabet’s recent performance. Plus, Apple’s higher valuation makes it harder to pick today.

By investor type, Alphabet fits growth-minded investors who want AI exposure at a more reasonable price, while Apple suits those who prefer a steadier, more established name and are willing to pay a premium for it. Neither is an income play, but for investors weighing technology against shareholder value, Alphabet has the stronger case.

On the date of publication, Rick Orford had a position in: AAPL , GOOGL . All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.