Forum Moderators: goodroi
SAN FRANCISCO (MarketWatch) -- Google Inc. saw its once high-flying share price fall under the $400 mark by midday Monday. This represents the lowest price for the stock since September of 2006, when the shares were still on a sharp upward climb following the company's initial public offering two years before. The Web search giant's stock peaked near the $750 mark in November of last year before a sharp sell-off in high tech stocks began to pressure the shares. By midday Monday, Google traded as low as $395.34, down 8% from its previous close, following a sharp sell-off in tech stocks as well as the broader market.
[edited by: engine at 5:16 pm (utc) on Sep. 29, 2008]
[edit reason] added quote [/edit]
Too many day traders swayed by the daily catastrophic news reports...
most people said we were totally wrong ..
or gold brokers :)
we were neither ..just had working BS meters ..that hit the red line everytime we heard a banker or a realtor or a commodity broker or energy/petro person speak..
BS meter is still hitting the stops hard enough to bend the needle ..glad the proposal got thrown out ..
Statistically, stock pickers, market timers, and manager pickers all do equally well over time.
And statistically, they all do as well as a monkey throwing darts at the WSJ.
There's entire volumes published on showing this to be the case. There's also entire volumes published showing why people still completely ignore the evidence :).
Google should grow up and focus on the three or four products that can make them money (aside of advertising), and get rid of the rest. This, of course, is a difficult step and will also require them to listen to the customers and partners. I don't think that this will happen anytime soon. So the stock will plummet further. Which is OK for me. :-)
How can one compare Google to Berkshire Hathaway...oh where to start...a company (berkshire) that owns hundreds of other companies in so many industries it is virtually indestructible...to a single-horse wonder (google) which can loose 50% of its income overnight if one clever kid comes up with an exploit that will knock out IE's javascript ...not to give someone any ideas
$341 right now.
"We'll take a look at the trades and make a judgment as to whether there were erroneous trades," she told Reuters, adding it was too early to know whether trades would be broken.
Reuters Story [reuters.com]
In a statement, the exchange said it will cancel all trades on the stock at or above $425.29 and at or below $400.52 that were executed between 3:57 and 4:02 Eastern
NASDAQ cancels certain trades on Google shares [marketwatch.com]
Right now Google is back to $409.
LOL. Google closed at $320.50 or down $60.50 today. Conventional wisdom is that it is way overpriced.
[i35.tinypic.com...]
Google actually closed at $381.00 with a P/E of 25.03. The average U.S. equity P/E ratio from 1900 to 2005 is 14. Google = overpriced stock.
P/E isn't the only variable to assess the value of a stock. If earnings grow by 35% per year, a P/E of 25 means "dirt cheap". Do the math: if the growth is sustainable after 5 years the P/E will stand at 7.8 (if the stock doesn't move) - or the stock will have doubled or more in the meantime.
If earnings don't grow or even shrink in the years to come .... some more air might come out of the stock.
It's hard to tell who's right, so let's wait and see :-)
"A market participant sent in a large number of orders and drove the price down at approximately [3:57 p.m. ET] which caused the bid-offer to be artificially low due to their mistake," according to a Nasdaq spokesman.Google's (GOOG, Fortune 500) official closing price will be adjusted to $400.52 from the original, inaccurate settle price of $341.43. And the closing value of the Nasdaq 100 Index will be changed to 1594.63.
Another way to assess a stock is evaluate it's price versus cash flow.
Last quarter Google had $1.7 billion of operating cash flow or around $7 billion per year. This means that Google trades at about 18-19 times cash flow right now which is a huge amount in an economy that is seeing massive slashing of advertising budgets.
Which, given the short attention span of certain groups of people, might not be that long. :)
With Google insiders selling shares, analyst downgrades, speculation about Google's upcoming October 16 earnings being below expectations; there will be much shareholder pain.
Look for Google in the $200's in near future.
Yep. The GOOG party is over.
Those who were in since IPO have probably sold either at the peak, or later at $500 or so. Now, all the long-term investors are selling as they understand that the ad market is going through challenging times (not 1st half, but 2nd half 2008), and the financial crisis tightens up the money sources across the board. The pro's definitely know when to jump ship.
:-)
Sorry, I could not hold back this smilie. This is "The Return of The Dotcom Bubble".
[finance.yahoo.com...]
Soooo, shareholders have only one way to earn money with GOOG stock - by selling higher than they purchased, which is fine in a bull market (but difficult in a bear market). So you need to find the next stupid person to sell your GOOG stock.
And if you think the shareholders can actually change this, think again! With Sergey & Larry & Eric holding 10 times the voting power of ordinary stock, they can control the company as long as they wish.
:-)
