Alphabet Inc announced a nearly doubling of capex spending in 2026, causing GOOGL stock to drop. However, with strong free cash flow, this presents a buying opportunity for investors. GOOGL closed at $322.86, down 6% from its peak on Feb. 2 but still up 16.9% from a three-month low in November 2025.

Alphabet’s capex nearly doubled in 2025, reaching $27.9 billion in Q4 and $91.4 billion for the full year. Despite this, free cash flow stayed strong at $73.266 billion, thanks to a 31.5% rise in operating cash flow. The OCF margin also increased, showing the success of Alphabet’s capex investments.

Analysts project a 16% revenue increase in 2026 for Alphabet, reaching $467.22 billion, and a 33% rise in 2027 to $536.27 billion. With an OCF margin of 46.8%, operating cash flow could total $234.8 billion, leaving room for strong free cash flow despite increased capex spending.

Investors can utilize out-of-the-money (OTM) put options to play GOOGL stock, with potential for additional profits. By selling OTM put options and collecting premiums, investors can secure lower buy-in points and potentially profit even if the stock stays flat. This strategy offers a conservative approach for value investors looking to capitalize on GOOGL.

Read more at Barchart: Why Alphabet’s Free Cash Flow Could Survive, Despite the Market’s Fears