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I hate how TechCrunch seems to idolize Google stock, as if its not going to be hovering at around $40-$50 in the next 18-24 months. The market in general is go

by kirse 18y ago

I hate how TechCrunch seems to idolize Google stock, as if its not going to be hovering at around $40-$50 in the next 18-24 months. The market in general is going to be coughing up some blood for awhile, and I'm going to bookmark this post and send it to Mr. Arrington when I'm proven right. I remember owning Yahoo at $300+ (which split) back during its high-flying days, and Google will be no different with its heavy reliance on advertising for revenue.

SwellJoe 18y ago
I'm curious why you believe GOOG will be trading at around 3 times earnings? That just doesn't even make sense to me, and I'm having a hard time imagining anything short of total economic collapse that could lead to such an unlikely scenario. While GOOG may not be bottomed out at ~$340 (I bought a few shares at $349, and am pretty happy with the price...and if it keeps dropping, I'll buy more, once it starts climbing again), I just don't see how you can possibly imagine it's a $40-$50 stock. Terrible companies trade at better than three times earnings, average companies trade at 10 times earning, and I don't think anyone is going to accuse Google of being a terrible, or even an average company. Google would pretty much have to start bleeding money to trade as low you're suggesting is inevitable.
- systems 18y ago
  why are you happy for buying google at $349, you bought at a high price, the price dropped ~ $10, you lost $10 a share ... what is happy about this story! really i want to understand your point of view
  - alaskamiller 18y ago
    because it's a $500 stock and when it bounces back he'll be doing pretty good?
  - SwellJoe 18y ago
    why are you happy for buying google at $349, you bought at a high price, the price dropped ~ $10, you lost $10 a share ... what is happy about this story! Obviously, because I've wanted to buy some GOOG for a while now, and it's been way too expensive. Maybe it was still a few bucks too expensive and my enthusiasm for the company blinded me to the still dropping state of the market...but I think Google is one of the best companies in the world, and it's currently trading at a fair price. If I believe that Google is going to weather the economic storm better than the average company (I do), and I believe that rapid inflation is going to insure that any money that I keep in cash is going to decline in value (I do), and I believe that Google revenue is going to grow faster than the returns from a CD (I do), and that when the market comes to its senses in a month or two or three it'll realize that GOOG is one of the best companies in the world and worth more than 22 times earnings, particularly given the huge stockpile of cash Google is holding (I do), then I don't feel too bad about missing the bottom by a few percentage points. And it's only 12 shares (so, $120 on a $4400 holding). And, like I said, if it keeps going down, I'll try to spot the bottom, or maybe wait until it actually starts a steady climb, and buy a few more shares. really i want to understand your point of view Do you understand it now? Basically, I just view it as a chance to own shares in a great international company at a dramatic discount off of recent valuations. It's not a "bargain" stock, even now, but that's because it is a stronger company than most of the stocks that were hit as hard. Yahoo has been hit far harder, but they're obviously not as good a company--though I think they're being maligned unfairly. They're still a great media company...they just have some problems making money. But I think Yahoo probably is a great buy right now.
    - kirse 18y ago
      Do you really believe that a company that makes the majority of its income from advertising will hold its value through one of the worst recessions were facing in a long time? There's going to be some major spending cutbacks across the board over the next couple years because there HAS to be (from people to business to government), and advertising/marketing is going to be at the top of the list. There is a fundamental shift in the economy right now - credit is drying up and people are going into conserve and save mode. There's no way in hell Google will have a $15 EPS two years from now, you can put this post in your calendar for October 2010. So yes, when Google's EPS is something like $1.50, it will make a ton of sense when they're trading at $40-50. Unless they've got some mysterious source of income, advertising is going to suffer horribly in this recession and so will the companies that depend on it.
  - khafra 18y ago
    The only reason anybody should be unhappy just because the stock he purchased dropped $10 immediately is if he's a day trader. If you look at the strengths, assets, and liabilities of a company, conclude it's a good purchase, and buy in, you should be happy unless some of those factors change. The stock becoming an even better buy doesn't change your good buy.

by kirse 18y ago

SwellJoe 18y ago

I'm curious why you believe GOOG will be trading at around 3 times earnings? That just doesn't even make sense to me, and I'm having a hard time imagining anything short of total economic collapse that could lead to such an unlikely scenario. While GOOG may not be bottomed out at ~$340 (I bought a few shares at $349, and am pretty happy with the price...and if it keeps dropping, I'll buy more, once it starts climbing again), I just don't see how you can possibly imagine it's a $40-$50 stock. Terrible companies trade at better than three times earnings, average companies trade at 10 times earning, and I don't think anyone is going to accuse Google of being a terrible, or even an average company. Google would pretty much have to start bleeding money to trade as low you're suggesting is inevitable.

systems 18y ago
why are you happy for buying google at $349, you bought at a high price, the price dropped ~ $10, you lost $10 a share ... what is happy about this story! really i want to understand your point of view
- alaskamiller 18y ago
  because it's a $500 stock and when it bounces back he'll be doing pretty good?
- SwellJoe 18y ago
  why are you happy for buying google at $349, you bought at a high price, the price dropped ~ $10, you lost $10 a share ... what is happy about this story! Obviously, because I've wanted to buy some GOOG for a while now, and it's been way too expensive. Maybe it was still a few bucks too expensive and my enthusiasm for the company blinded me to the still dropping state of the market...but I think Google is one of the best companies in the world, and it's currently trading at a fair price. If I believe that Google is going to weather the economic storm better than the average company (I do), and I believe that rapid inflation is going to insure that any money that I keep in cash is going to decline in value (I do), and I believe that Google revenue is going to grow faster than the returns from a CD (I do), and that when the market comes to its senses in a month or two or three it'll realize that GOOG is one of the best companies in the world and worth more than 22 times earnings, particularly given the huge stockpile of cash Google is holding (I do), then I don't feel too bad about missing the bottom by a few percentage points. And it's only 12 shares (so, $120 on a $4400 holding). And, like I said, if it keeps going down, I'll try to spot the bottom, or maybe wait until it actually starts a steady climb, and buy a few more shares. really i want to understand your point of view Do you understand it now? Basically, I just view it as a chance to own shares in a great international company at a dramatic discount off of recent valuations. It's not a "bargain" stock, even now, but that's because it is a stronger company than most of the stocks that were hit as hard. Yahoo has been hit far harder, but they're obviously not as good a company--though I think they're being maligned unfairly. They're still a great media company...they just have some problems making money. But I think Yahoo probably is a great buy right now.
  - kirse 18y ago
    Do you really believe that a company that makes the majority of its income from advertising will hold its value through one of the worst recessions were facing in a long time? There's going to be some major spending cutbacks across the board over the next couple years because there HAS to be (from people to business to government), and advertising/marketing is going to be at the top of the list. There is a fundamental shift in the economy right now - credit is drying up and people are going into conserve and save mode. There's no way in hell Google will have a $15 EPS two years from now, you can put this post in your calendar for October 2010. So yes, when Google's EPS is something like $1.50, it will make a ton of sense when they're trading at $40-50. Unless they've got some mysterious source of income, advertising is going to suffer horribly in this recession and so will the companies that depend on it.
- khafra 18y ago
  The only reason anybody should be unhappy just because the stock he purchased dropped $10 immediately is if he's a day trader. If you look at the strengths, assets, and liabilities of a company, conclude it's a good purchase, and buy in, you should be happy unless some of those factors change. The stock becoming an even better buy doesn't change your good buy.