Google Stock - Golden Opportunity or Fool's Gold?

Discussion in 'Google' started by wrmineo, Dec 5, 2005.

  1. #1
    Larry Page and Sergey Brin sold off a slice of their Google pie in August 2004 netting each of them $1.3 Billion, and people have been lining up to buy the stock ever since.

    Google's IPO price of $85 lasted but a mere few minutes. The price quickly surpassed the $200 level, and quickly onto $300, and recently topped $400 per share, allowing Google to establish themselves as the gold standard of the Internet.

    However, Google's rapid run-up is making it more difficult to figure out how outside investors can make money on the stock, said Stanford Financial Group analyst Clayton Moran.

    "I think the current price is justified, but I just can't go out and tell my clients to buy the stock now," said Moran, explaining why he downgraded Google's shares to a "hold" earlier this week.

    Moran values Google's shares at $425 — higher than more pessimistic analysts like Standard & Poor analyst Scott Kessler, who believes $364 is a more realistic price. Google's shares closed at $417.70 Friday, up $3.61.

    Google's shares, in fact, would probably tumble badly if the company were to miss the lofty earnings expectations being set by analysts with no guidance from management.

    Other thorny issues could easily prick the stock.

    The company already is locked in a series of legal battles over the search engine's alleged abuse of trademark and copyright laws while mighty Microsoft — armed with $40 billion in cash — continues to invest heavily in a strategy aimed at toppling Google. Some analysts also are worried about Google's ability to manage a rapid expansion that might include a substantial investment in Time Warner's AOL.

    Nevertheless, betting against Google so far has proven to be a bad idea.

    Google is expected to earn $8.53 per share next year, based on the mean estimate among 29 analysts surveyed by Thomson Financial. That gives Google a p/e multiple of 49, much higher than most stocks.

    A recent article in the USA Today makes some very interesting comparisons between the value of Microsoft and Google. But after looking at these comparisons, you may come to the conclusion there is no comparison at all - Google is peerless.
     
    wrmineo, Dec 5, 2005 IP
  2. Eddy

    Eddy Peon

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    #2
    Google is peerless Period
     
    Eddy, Dec 5, 2005 IP
  3. zanet

    zanet Peon

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    #3
    Peerless Google hmm

    Definitions of Peerless By Google:

    matchless: eminent beyond or above comparison; "matchless beauty"; "the team's nonpareil center fielder"; "she's one girl in a million"; "the one and only Muhammad Ali"; "a peerless scholar"; "infamy unmatched in the Western world"; "wrote with unmatchable clarity"; "unrivaled mastery of her art"
     
    zanet, Dec 5, 2005 IP
  4. wrmineo

    wrmineo Peon

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    #4
    Ah, the ever-humble Google - I'm surprised they weren't included in that definition. :rolleyes:
     
    wrmineo, Dec 5, 2005 IP
  5. puzzlebox

    puzzlebox Guest

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    #5
    now that is funny.. :) hehehe
     
    puzzlebox, Dec 5, 2005 IP
  6. Red

    Red Peon

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    #6
    I'll say that it can become both of these! :)
     
    Red, Dec 5, 2005 IP
  7. tesla

    tesla Notable Member

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    #7
    Google is the real McCoy. I'm planning on getting a few shares in the next year or so.
     
    tesla, Dec 6, 2005 IP