homepage Welcome to WebmasterWorld Guest from
register, free tools, login, search, pro membership, help, library, announcements, recent posts, open posts,
Pubcon Platinum Sponsor 2014
Home / Forums Index / Google / Google Finance, Govt, Policy and Business Issues
Forum Library, Charter, Moderators: goodroi

Google Finance, Govt, Policy and Business Issues Forum

Earnings Estimates
Concerned over fuzzy numbers

10+ Year Member

Msg#: 427 posted 2:53 pm on Oct 29, 2004 (gmt 0)

One thing that's been bothering me about GOOG valuations lately is the big disparity between the various EPS (earnings per share) numbers. My concern is that valuations are based on a fuzzy version of EPS that has nothing to do with the real EPS.

For Q3, analysts were expecting $0.56. GOOG came in at $0.19. Without the one-time charges from the Yahoo settlement, it would have been $0.45. An analyst on the call somehow arrived at $0.75. Yahoo is showing that they did $0.70 [finance.yahoo.com].

Yahoo is now showing that the average EPS estimate for 2004 is $2.53 [finance.yahoo.com], with $0.76 in Q4. Q1-Q3, according to Google, was $0.73 ($0.24+$0.30+$0.19). According to Yahoo, it was $1.81 ($0.53+$0.58+$0.70).

Yahoo is showing the average EPS estimate for 2005 as $3.40. With 275 million shares, that's nearly a billion dollars in profit. If Google does 5 billion in sales in 2005 (which I think is a high, but doable estimate), that's a 20% profit margin. Google's profit margin is about half of that.

My own estimates put GOOG's EPS at about $5 to $6 in about 5 years, but the analyst's fuzzy EPS numbers put them relatively close to that next year. I think a $2 EPS is much more realistic next year.

These high estimates from the analysts and fuzzy EPS numbers could send GOOG into the ground over the next year as Google "disappoints" by missing the fuzzy numbers.

Am I missing something?


Global Options:
 top home search open messages active posts  

Home / Forums Index / Google / Google Finance, Govt, Policy and Business Issues
rss feed

All trademarks and copyrights held by respective owners. Member comments are owned by the poster.
Home ¦ Free Tools ¦ Terms of Service ¦ Privacy Policy ¦ Report Problem ¦ About ¦ Library ¦ Newsletter
WebmasterWorld is a Developer Shed Community owned by Jim Boykin.
© Webmaster World 1996-2014 all rights reserved