Amr at Yahoo analyzed the 4th quarter situation at GOOG and appears to have called the shot brilliantly. I think it was an intriguing example of how an insider at the *competition* can see things that even savvy investors might miss. That said I need to check to make sure Amr was right for the right reasons – ie revenue issues vs earnings.
If he IS right for right reasons I think I’ll act on his advice NEXT time, knowing the market is slow on the uptake when it comes to processing dot com stock pricing information (example is virtually every dot com stock of 1999).
Meanwhile, Om Malik writing for CNN seems to miss the point, suggesting this is just a little dip in Google’s rise to global dominance.
Anybody, especially siliconized, who suggests that there is no doubt in the future of a company evolving as fast as Google is simply not paying attention. With a capitalization still exceeding that of some nations, Google is hardly comparable to a startup. Sure Google might take over the world – they are a fantastic company. But they also may, heaven forbid and cross yourself, make some big mistakes. Many think they have already made some. AOL deal, China deal, DOJ non-deal.
If the price drop immediately following the “less than spectacular” earnings report yesterday was a “knee jerk” as Om suggests, it was more consistent with reality than the rising price last year which I rarely heard described as anything but consistent with the company’s performance.
I’m simply floored by those who should know better to imply that *this time* the huge stock price and expectations are “realistic”.
DISCLOSURE I – I’ve got some GOOG puts, which means I’m potentially biased here. But only potentially, I’m going to call it like I see it and my blog is hardly market-moving commentary.
DISCLOSURE II – Google pays me to run adsense ads at several of my websites and I appreciate the cash and T shirts.
DISCLOSURE III – I know several people who work at Google. They are nice and super smart and I wish them the best.
DISCLOSURE PS – I hope this doesn’t mean I can’t go to the Google Dance 2006. I still think Google is great, just very strangely priced.