Alphabet Inc. (GOOGL) vs MGM Resorts International (MGM): Which Is the Better Buy in 2026?
As of 2026-11-01, GOOGL is overvalued at $280, with a DCF intrinsic value of $8 and a margin of safety of -3448%. MGM is overvalued at $30, with an intrinsic value of $0 and a margin of safety of -100%. Of the two, MGM has the wider margin of safety.
Rewards
- ★Alphabet Inc. has maintained ROIC above 15% for 4 consecutive years, indicating a durable competitive advantage.
- ★Gross margin of 60.9% indicates strong pricing power — typical of businesses with significant intellectual property or brand strength.
- ★Alphabet Inc. scores 89/100 on the Economic Moat Score (Wide Moat), with roic consistency as the strongest competitive dimension.
- ★Free cash flow has grown at a 13.8% CAGR over the past 4 years, demonstrating strong earnings power growth.
- ★Share count has been reduced by 32% over the past 4 years through buybacks, increasing each share's claim on earnings.
- ★FCF yield of 19.3% is historically attractive — the business generates significant cash relative to its price.
Risks
- ⚠Buybacks have been poorly timed — 3 out of 4 years involved repurchases at relatively expensive valuations.
- ⚠High leverage (8.03x net debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
- ⚠Net debt/EBITDA of 12.7x indicates heavy leverage — it would take over 4 years of EBITDA to pay off net debt.
Key Valuation Metrics
Learn more →Historical Fundamentals
Learn more →Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.
$1 Retained Earnings Test
Learn more →> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
Discounted Cash Flow (DCF) Analysis
Learn more →Reverse DCF — Market-Implied Growth
Learn more →Requires positive FCF to compute implied growth rate.
What growth rate is the market pricing in at $30?
The market implies +37.5% Owner Earnings growth, above historical trends.
Standard FCF implies a demanding +10.1%, reflecting heavy growth investment.
Economic Moat Score
Learn more →Wide moat driven primarily by roic consistency. Reinvestment Efficiency is the area most vulnerable to competitive pressure.
No durable moat detected, though reinvestment efficiency shows some competitive positioning. The business lacks consistent evidence of sustainable advantages.
Forensic Accounting
Learn more →M-Score Trend
M-Score Trend
Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
Ownership Breakdown
Learn more →High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.
Insider Buying Activity
Learn more →Open market purchases · includes direct & indirect ownership · excludes option exercises.
Insider Selling Activity
Learn more →Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.
🎭 Mr. Market's Mood
Learn more →"Market is pessimistic — investigate whether fears are temporary or structural"
"Market is pessimistic — investigate whether fears are temporary or structural"
Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
⚖️ Buffett Signal
Learn more →The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.
Frequently Asked Questions: GOOGL vs MGM
Is Alphabet Inc. or MGM Resorts International more undervalued in 2026?▼
Based on our discounted cash flow model, MGM trades at a -100.0% margin of safety (intrinsic value $0 vs. price $30), compared to GOOGL's -3447.8% margin of safety (intrinsic $8 vs. $280).
Which stock has a wider economic moat, Alphabet Inc. or MGM Resorts International?▼
GOOGL scores 89/100 (Wide moat), while MGM scores 36/100 (None moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.
Is MGM Resorts International in financial distress?▼
MGM's Altman Z-Score of 0.8 places it in the Distress zone, signaling elevated bankruptcy risk. GOOGL scores 2.4 (Grey zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.
Which company has better free cash flow, Alphabet Inc. or MGM Resorts International?▼
MGM Resorts International (MGM) generates a 19.3% free cash flow yield, compared to Alphabet Inc.'s -0.0%. A higher FCF yield means the business converts more of its market value into cash that can be returned to shareholders or reinvested.
Which stock has higher return on invested capital, Alphabet Inc. or MGM Resorts International?▼
GOOGL earns 14.3% ROIC versus MGM's 1.0%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.