A VC - Latest Comments in What's Ailing Google's Stock Price?

Re: What's Ailing Google's Stock Price?

fredwilson — Wed, 19 Nov 2008 05:49:58 -0000

I am continuing to buy it

Well see in a few years about the wisdom of that

Re: What's Ailing Google's Stock Price?

Joe — Tue, 18 Nov 2008 11:47:14 -0000

It's the 18th of Nov and now Google stock is trading at $290.00 a share! I feel sorry for the people who read this article and bought in at $400.00 a share. Hahaha!

Re: What's Ailing Google's Stock Price?

siddiq — Thu, 06 Nov 2008 17:23:55 -0000

nice!! i m soo intrested in this i m high school student sopmore and in our consumer class we were talking about stocks! i really got into it.

Re: What's Ailing Google's Stock Price?

fredwilson — Wed, 08 Oct 2008 17:45:16 -0000

I have to buy more

That's my game plan

Re: What's Ailing Google's Stock Price?

stock4us — Wed, 08 Oct 2008 14:05:53 -0000

Now that the price is 350, what are your thoughts?

Re: What's Ailing Google's Stock Price?

fredwilson — Mon, 29 Sep 2008 17:29:16 -0000

I bought some today and will buy more if it keeps going lower. I am starting to accumulate a position

Re: What's Ailing Google's Stock Price?

jbenz — Mon, 29 Sep 2008 15:57:36 -0000

Google just hit $380. What's your call?

Re: What's Ailing Google's Stock Price?

mm — Thu, 11 Sep 2008 10:58:19 -0000

investors are concerns about risks to 3Q estimates due to the strengthening dollar. it's short-sided selling, something that has become the most important driver of stock prices of late

Re: What's Ailing Google's Stock Price?

terra210 — Thu, 11 Sep 2008 09:19:04 -0000

I agree that GOOGs position in the new web-based operating system for serving apps is well positioned.

Re: What's Ailing Google's Stock Price?

fredwilson — Thu, 11 Sep 2008 08:09:28 -0000

I would look to $600 to start peeling off some and maybe $800 to $1000 to
unload it all

It could, of course, take years to reach those levels

Re: What's Ailing Google's Stock Price?

fredwilson — Thu, 11 Sep 2008 06:55:35 -0000

I am thinking about areas like local/maps and google apps

Re: What's Ailing Google's Stock Price?

Angela Hey — Thu, 11 Sep 2008 02:07:52 -0000

Less free food for Googlers and Yahoo!'s mobile platform might scare off some Investors in GOOG

Re: What's Ailing Google's Stock Price?

James Adams — Wed, 10 Sep 2008 17:12:00 -0000

I wouldn't say they look "cheap" at the current price given nearly all their revenue comes from advertising and the global economy is looking rather dodgy. Their range of projects and products is impressive strategically but they're some way off earning revenue and traders are notoriously short sighted with things like this.

Given their business they'll be heavily effected by how much money is sloshing around the economy. If there is a contraction in the money supply and a deflationary period they're going to suffer in the short/medium term like nearly every other company. So it basically comes down to what you think will happen in the US/Global economy over the next 2 years.

Re: What's Ailing Google's Stock Price?

Gopi — Wed, 10 Sep 2008 11:04:41 -0000

Fred, here do you think the immediate growth will come from??. (Apart from future potentials like Android or Video monetization which may take years!)

1, Not from gaining search market share - It has only 10-20 points to gain in the US market, most oversees market is tapped out (90% share in most markets). Also the total search market pie is not growing fast.

2, Not much left to squeeze from eCPM optimization - Remember most of the growth in the last 2 years came from this sort of revenue optimization (via adword quality score) than organic traffic growth. IMO, there is not much left to extract in this area

The only area left for immediate growth is display ads - but unlike adwords this is a low margin business (like adsense) so it has little effect in the net cash flow.

Re: What's Ailing Google's Stock Price?

fredwilson — Wed, 10 Sep 2008 08:42:09 -0000

Not really. I'd buy more if it went down.

Re: What's Ailing Google's Stock Price?

andyswan — Tue, 09 Sep 2008 22:55:55 -0000

Just make the check out to CASH ;)

Re: What's Ailing Google's Stock Price?

Quentin — Tue, 09 Sep 2008 21:14:37 -0000

Is there any way to just cut out the middle man and just invest in andyswan? If so, I'm all in!

Freakin rocks.....rocks

Re: What's Ailing Google's Stock Price?

CoryS — Tue, 09 Sep 2008 19:50:53 -0000

Fred,
Fundamentals = GOOG is in the advertising business, they didn't get a piece of the Olympics and likely won't see much in the way of the presidential election which are the only two spending drivers for the year. Step to the corporate view and the only profit driver is from ad revenues (as cool as Chrome is, it doesn't change profit streams). Analysts model cash flow, and the ad environment is terrible.

As an aside, I'm on the record earlier this year:
http://backseatmarketers.co...

Re: What's Ailing Google's Stock Price?

Guest — Tue, 09 Sep 2008 16:54:14 -0000

Fred,
I might not be a great start up manager but I use to run an option trading operation for many years.
1) selling puts is not a great idea if you expect a rebound. You will pocket the premium but miss the whole upside. You would not bet on the direction only, but on direction + timing. Good luck.
2) the multiple is linked to expected future earnings. Expected future earnings are partly linked to the reputation of the firm. Google's reputation is shifting. Writing "don't be evil" does not seem to be sufficient anymore to appear cool when your business basis is storing personal preferences.
3) I wrote more on my blog this morning (http://camblain.over-blog.c.... As a VC, your fate is already linked to Tech share prices anyway. You do not need to double up and fall in the category of people who do not believe in diversification: " I work in the sector, diversification is for amateurs". not you.
Sincerely
Jerome Camblain

Re: What's Ailing Google's Stock Price?

yan_i — Tue, 09 Sep 2008 16:31:48 -0000

This blog post is one way to increase the odds of your investment being successful :)

Re: What's Ailing Google's Stock Price?

research — Tue, 09 Sep 2008 15:21:50 -0000

Munster from PJ says 785 in a year.... buy and let it double, then sell a quarter of it... be an investor, not a trader.

Re: What's Ailing Google's Stock Price?

Jim Kerr — Tue, 09 Sep 2008 14:44:11 -0000

This would be the case if 1) Google was making the phones, which they are not or 2) Google was getting money to license the OS, which they probably are, but not to the extent they could if it weren't open source.

To make money with Android, Google has to either make phones like Apple or Nokia or find a way to build monetization into the platform. They may do that with integrated search, POI Adwords, and similar, but that market isn't a given, and too much integration will get them into trouble with regulators, especially if someone other than McCain wins the White House.

Re: What's Ailing Google's Stock Price?

Jim Kerr — Tue, 09 Sep 2008 14:40:51 -0000

Fred,

I don't know much about the stock market, but I can say that there are probably several things at play here. One is that it appears that people are betting that Google is going to lose their billion dollar lawsuit to Viacom, and that this will presage a big problem with Youtube. The second is that Google, despite all the love from the tech side, is really well behind Yahoo in just about every category Google dabbles in. Gmail? Yahoo beats them. Picasa? Flickr beats them. You would be hard-pressed to find a certifiable big win revenue producer for Google outside of search. You can most likely add Chrome to that list.

I'm guessing that kind of shotgun approach to R&D is flying about as well with Wall Street as it is with consumers... It's interesting and all, and they have some marketshare and modest momentum, but overall, they aren't category leaders anywhere other than search and video via Youtube (and we all have seen the difficulty Youtube is having monetizing its platform).

I'm a huge fan of the potential of Android, but more because it's open source and Google will put money behind it more than it is from "Google." With what Nokia is doing with Symbian and QT, it is possible that Google can even become a mobile phone OS leader and still not make money from it as the OS will become a commodity and the real money is in the phones. In this scenario, Nokia has the right idea.

I certainly get that Google may lose money on all these initiatives and do well if they lead to a greater increase in their Adwords and Search revenue based on the platforms, but that still remains to be seen if it is viable.

Re: What's Ailing Google's Stock Price?

fredwilson — Tue, 09 Sep 2008 14:25:13 -0000

That's great insight.

If and when I start buying, I'll average into the stock in probably four trades over a 3-6 month period so I'm not particularly concerned if it goes down or up. this would be a buy and hold to a target price. I need to develop that target price a bit more.

Re: What's Ailing Google's Stock Price?

mattmaroon — Tue, 09 Sep 2008 13:18:03 -0000

Part of what's ailing their stock price is their stock price. They should go ahead and 10:1 split like a normal company. As Mark Cuban says, it's all baseball cards at this point, and there's more than 10x as much demand for $40 baseball cards as there is for $400.

Mostly though it's probably because growth in their core business is slowing, and doesn't show any signs of stopping. Their search growth in the developed world isn't that far from the 100% ceiling, and they're making little to no progress in China. Ad blockers are probably growing faster than DoubleClick and AdSense combined.

They're making moves at enterprise, but they seem to be doing it not with intent to capitalize but instead to make Microsoft lose money. The arms race in the free web-based productivity suites will ensure that nobody ever makes a dime off of them.

I don't know if Google is undervalued at $400, but they were greatly overvalued at $700, so it's at least mostly a correction. I might consider buying them anyway though because I think Android is going to be game-changing in the way that everyone thought the iPhone would, and they obviously stand to benefit from it.