Why Gabelli’s Global Content & Connectivity Fund Likes Alphabet (GOOGL)

The Gabelli Investment Management Firm's Global Content & Connectivity Fund released its second-quarter 2026 investor letter, highlighting its strong performance and outlook for AI-related investments. The fund's Class I shares gained 12.88% in Q2 2026, outperforming the MSCI AC World Communication Services Index by double the 6.02% return.

The fund's strong results can be attributed to growing interest in AI, easing Middle East tensions, and lower oil prices. During the quarter, Information Technology rose 39.2%, while Communication Services increased 6.0%. Over the past year, the fund gained 25.50%, surpassing its communication-services benchmark by 11.44% and the MSCI AC World Index by 1.34%.

Looking ahead, the fund remains optimistic about the long-term potential of AI adoption, expanding digital infrastructure, connectivity, and content and entertainment industries. In the same investor letter, the fund mentioned T-Mobile US Inc. (NASDAQ:TMUS), the second-largest wireless operator in the U.S., serving over 142 million branded customers.

T-Mobile US has increased its 2027 targets for service revenue, EBITDA, and free cash flow, driven by share gains, broadband expansion, and leveraging its 5G Advanced network for new growth areas. The fund acknowledged the risk associated with T-Mobile US but believes other AI stocks offer more promising returns in the near term.