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Google Earnings Come Early; Shares Drop
- uptown 14y agoSpeculation is that their filing agent may have accidentally released them early. update: confirmed by R.R. Donnelley & Sons
- wtvanhest 14y agoWhere is that source?
- waterlesscloud 14y agoThere's a quote from Google confirming in this TC post: http://techcrunch.com/2012/10/18/googles-stock-takes-a-dive-after-mid-day-earnings-release-trading-halted/ http://techcrunch.com/2012/10/18/googles-stock-takes-a-dive-... Also, trading was halted at Google's request while they complete the document.
- hkmurakami 14y ago> Its incompleteness was evidenced by the inclusion of the phrase, “PENDING LARRY QUOTE,” just above a summary of results. source: http://www.bloomberg.com/news/2012-10-18/google-blames-r-r-donnelly-for-early-earnings-statement-release.html http://www.bloomberg.com/news/2012-10-18/google-blames-r-r-d...
- trequartista 14y agoPending Larry has already arrived on Twitter - twitter.com/PendingLarry
- arscan 14y agoLooks like it took investors about 30 minutes to figure out who made the mistake: https://www.google.com/finance?q=NASDAQ%3AGOOG+NASDAQ%3ARRD https://www.google.com/finance?q=NASDAQ%3AGOOG+NASDAQ%3ARRD
- jpdoctor 14y agoconfirmed by R.R. Donnelley & Sons I wonder how much the bribe was? I'm sure much less than the profit on puts/calls.
- jamesmcn 14y agoGoogle is advertising company which enjoys masquerading as a computer science R&D lab. They build self-driving cars. They launched a satellite. I suspect that they will start making their own SEC filings soon.
- Wohlf 14y agoI think when you accomplish some of the things Google does, it becomes less of a "advertising company which enjoys masquerading as a computer science R&D lab" and more of "an advertising company that owns and funds a computer science and engineering R&D lab".
- toomuchtodo 14y agoI much prefer "a computer science and engineering R&D lab that happens to have an advertising arm".
- jamesmcn 14y agoAdvertising is where they make their money. It is nice that they do cool things, but few of those things have anything to do with their core business. My point was that they do a lot of fun things that aren't core to their business. Properly filing their SEC documents might be worth a little more attention. Not quite as sexy as self-driving cars, but if they can't keep the core business running then they won't have time for autonomous cars.
- hodder 14y agoWell that was an easy short. RRD dropped long after your update. Nice work Uptown!
- _pferreir_ 14y agoPanic anyone? If it has indeed been an accidental release, someone is going to pay very dearly for it.
- bluekeybox 14y agoJust read some article which talks about the "fear" that consumers may be getting smarter and increasingly relying on direct searches and mobile apps (aka Amazon website, Amazon mobile app) instead of going through Google. If that is correct, then it sounds like a shift in the market rather than shrinking. Admittedly though it sounds more like a rationalization of reduced earnings with no direct proof.
- diego 14y agoAs an interesting aside, I created a word cloud with the last 1000 Hacker News headlines to cross the 250-point threshold. I found Google was in 49 of those. Hacker News seems to care more about Google than any other company. http://images.diegobasch.com/newsyc250.png http://images.diegobasch.com/newsyc250.png
- cft 14y agoInteresting: I could not spot Facebook there easily?
- jamesaguilar 14y agoI found Zuck, but no Facebook.
- ihsw 14y agoYou say that like it's a bad thing.
- mbesto 14y agoCurious - are you using NetBase for this?
- dholowiski 14y agoTrading has been halted as well.
- baltcode 14y agoWhy do they do this? Isn't the whole point of the free market that the prices stabilize quickly without interventions?
- waterlesscloud 14y agoGoogle requested to halt so they could finish the report. The early released version is not 100% finished.
- jonknee 14y agoBecause the market is "stabilizing" on possibly inaccurate information that was not meant for release. It goes into securities fraud pretty quickly if you knowingly put out incorrect financials and allow trading.
- shiftpgdn 14y agoBecause the price fell dramatically from a release of information that wasn't from Google. Until its confirmed by Google it's just speculative which NASDAQ doesn't want. Source: http://www.nasdaqtrader.com/Trader.aspx?id=TradeHaltCodes http://www.nasdaqtrader.com/Trader.aspx?id=TradeHaltCodes
- smackfu 14y agoNormally earnings are released when the markets are closed, so this doesn't seem so unusual.
- guyzero 14y agoYeah, everyone loved the free market back in 1929.
- bcoates 14y agoThe 1929 stock market collapse was an accurate reflection of real-world economic conditions, it wasn't a panic crash and it didn't cause the great depression. There are a ton of theories about why the depression happened but pretty much none of them claim fiddling with the stock market rules would have helped anything. Stock prices during the depression were reasonable, they were just news nobody wanted to hear.
- gfodor 14y agokind of stoked about this, been waiting for an opportunity to go long GOOG due to their autonomous car moat they're carving.
- pclark 14y agotheir autonomous car project is folly
- InclinedPlane 14y agoProve it.
- pclark 14y agoGoogle is incompetent at expanding into adjacent markets to search engine marketing. That is their core competency. You think they can enter the automobile industry? You're insane.
- gfodor 14y agoWho says they need to "enter the automobile industry?" They just need to license their tech. Also, nobody else is going to be able to do it anytime soon without their data. The cars rely upon the street-level map data Google has, and nobody has as it or is any position to get it anytime soon.
- adrinavarro 14y agoThat's why they failed at building a mobile operative system. Same happened when they tried to get into the email business. Or the office applications sector. Oh…
- aboodman 14y agoAnd web browsers :)
- revelation 14y agoI love this talk of "analysts". Did the "analysts" miss that Google just bought a struggling 10B+ Motorola? Do they expect it to be some magic unicorn that can turn Motorolas losses into Googles profits in a single quarter?
- smackfu 14y agoHere are the analyst numbers in a bit more detail: http://finance.yahoo.com/q/ae?s=GOOG+Analyst+Estimates http://finance.yahoo.com/q/ae?s=GOOG+Analyst+Estimates 38 separate analysts, high estimate was $13, low estimate was $9.92. Average was $10.65, actual numbers were $9.03, so below even the most pessimistic analyst. That usually means the publicly available info just wasn't accurate, that something happened privately that only Google knew about. Usually companies avoid this kind of thing by giving some mid-quarter update so that they can mitigate some of the damage. Google actually provides no EPS guidance at all though, which also caused problems with a big miss in January 2012. Analysts like to have something to work off of.
- rm999 14y agoAnalyst earning forecasts are known to be optimistically biased. Here's a paper discussing this: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=971027 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=971027
- smackfu 14y agoWhich should theoretically let you "put your money where your mouth is", since if analysts are systematically wrong, and the prices move in response to analysts...
- jamesaguilar 14y agoI think you'd have to test the latter assumption too before you go betting against them.
- rm999 14y ago
- gfodor 14y agoSome poor bastard on another forum I read had short put options open and was literally in the middle of closing them (due to earnings release at end of market) with his mouse when the stock dropped.
- jrockway 14y agoThis doesn't sound that terrible. One enters into a short put position when he believes that XYZ company is worth buying at $X, but not at the current price. So you open the short put position at the $X strike price and either collect the premium if the stock doesn't go down, or be assigned the shares at the price you think they're worth if the stock does go down. Assuming you did your research right, both are good positions to be in. And remember: if a particular option you're selling has a really high premium, it's because the market expects the position to be risky.
- mynameishere 14y agoBeing forced to buy 700 dollar shares at 760 (or whatever) is not a good position to be in. Especially if you don't have the money, which happens often enough.
- jrockway 14y agoMy brokerage won't even let me open the position without having enough money to cover the share assignment.
- xhrpost 14y agoI'm not a stock expert and we have limited information here but I think I understood the dilemma in a different way, perhaps someone can fill us in. I took OP's explanation that this man had actually shorted (sold options he didn't own) put options in the past. If their strike price happened to be very close to the Google share price early this morning, and they expire this Friday, then they would be relatively cheap to close (i.e. buying them back to close his position). However, the price drop would cause those same put's to jump in price by roughly the loss on a share. So what would cost him a few dollars or pennies per share to close, now costs $60 per share to close. Options are traded in 100 packs so I take it this put him back thousands.
- Cieplak 14y agoDefinitely not the first time RR Donnelley has dropped the ball.
- bhartzer 14y agoSomeone in PR is going to be fired over this.
- deleted 14y ago[deleted]
- mtkd 14y agoThere is a lot of good numbers in that release. Motorola down to be expected. PPC yields -15% is concerning but the soon to come monetization of Shopping is going to reverse that. The p/e is 20 vs FB at 66. Google are still the strongest and most consistently innovative large-cap around. They've already moved past the point that MS failed at. Google ad systems are going to be able to subsidise hardware (TVs, phones, tablets, cars) in a way no other company can going forwards.
- chadzawistowski 14y agoThey've already moved past the point that MS failed at. Can you elaborate? Are you referring to the late 90s trials and their aftermath?
- mtkd 14y agoMicrosoft tried to compete in every technology market simultaneously - spreading the inhouse talent too thin becoming nothing to anyone. The few really good products they had (SQL Server, OneNote etc.) got lost in the noise. Everything became unstable, clunky, complicated and inconsistent. Most kids leaving school now think Xbox when they hear 'Microsoft' - not really the legacy Microsoft deserved. (it could all have been solved by splitting the company up in to 4 - OS/tools, Gaming, Apps, Online Services and letting them compete in their own vertical spaces without having to do things the Microsoft way - SQL Server running on Linux, VS on OSX etc.) Google haven't fallen in to that trap - they are not competing in every single market - when they do compete in a new market they don't dilute their existing product quality - and there is a cohesion to the product strategy.