Recent

% | $
Quotes you view appear here for quick access.

Google Inc. Message Board

  • ajlelati ajlelati Feb 18, 2005 10:03 PM Flag

    Consider the Facts...

    Google�s Facts 2005-02-18

    1. After a major lock up period this week the stock went up not down. In fact it went up about 10 points - Very good.

    2. Earnings were way above estimates - Very good

    3. Looking at yahoo finance page for google 1 yr target: $236 - $38 above current price $198

    4. MSN Stock scouter rating: 9 (10 is the highest)

    5. Three upgrades this month alone. One today.

    Considering all of the above, it looks that this is a good stock to long not to short!
    I like to read your comments.

    Thanks

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • <<
      In reference to the 7.4 billion market size projection, projections by analysts and industry pundits can turn out to be mistaken. Just look at analyst estimates for GOOG revenues in 2005 - no revenue growth yet subtantial EPS growth is projected versus 2004. I think their revenue estimates are in need of updating. >>

      The revenue is from an industry watcher. The eps is from sell side analysts. I would more trust an industry watcher than i would a sell side analyst.

      So you think 18% yoy year growth for the next four years is not aggressive enough? Now you are stretching it.

      Have a good night

    • 100 billion dollars. Well that's a double from here. I'll take that.

      In reference to the 7.4 billion market size projection, projections by analysts and industry pundits can turn out to be mistaken. Just look at analyst estimates for GOOG revenues in 2005 - no revenue growth yet subtantial EPS growth is projected versus 2004. I think their revenue estimates are in need of updating.

    • The search engine industry is currently only 3.8 billion (ttm) according to this article:

      http://biz.yahoo.com/ap/050212/click_fraud_4.html

      goog had 3.2 billion total revenue for the year and they pretty much blasted the industry open this year so I assume the numbers are accurate

      I just did a Yahoo finance screen of the stocks with a market cap of over 100 billion dollars. Of the 28 companies the highest forward p/e is only just over 21. At some point the law of big numbers is going to come into effect.

    • "when the entire search engine industry is only expected to grow to 7.4 billion in revenues by 2008."

      Therein lies the problem. Google's revenues were $1 billion in Q4, so its market share was $4 billion on an annual basis. So I think the search market is already over the $7.4 billion figure.

    • <<Hulbert's assumed stock price = $525
      PE = 525/10.19 = 51.5, in agreement with Hulbert's assumed PE>>

      you are assuming that a stock with a market cap of
      143 billion will get away with being assigned a p/e
      of 50. What happens if the market only lets them
      have a 25?

      If they grow their earnings by greater than 20% for
      five years what is to assume they will be able to do
      it again? It just doesn't work that way so sound
      reasoning says that the p/e on the stock will get a
      much lower assignment by that time.

      Also, 2.781 billion dollars in earnings is 11 billion in
      revenue in 2010 when the entire search engine
      industry is only expected to grow to 7.4 billion in
      revenues by 2008. Are you expecting search
      revenue to grow by 22% in the last two
      years(assuming goog gets 100% of it) or is there
      some rabbit that goog pulls out of its hat that it has
      yet to do in the first five years of it's one trick pony
      existence?

      Here is another question for you. What happens if
      googs 25% profit margin shrinks due to competition?
      Then by 2010 it won't need 11 billion in revenue. At
      20% it will need 13 billion and at 15% it will need
      18 billion!

      With a commoditized product like internet
      advertising how is goog going to maintain its high
      margins? By then the world will have cranked out a
      couple of million more programmers and I'll bet
      they'll all have a webpage selling their own
      advertising

    • My point is that almost anything CAN be called a non recurring charge.

    • The land purchase is capex. It will not impact net income on either a GAAP or non-GAAP basis, thus it is not a non-recurring charge. However, any buildings constructed on the land will have to be depreciated over their useful life.

      "Have you aver seen a quarterly report from ANY company that did not have a non recurring charge in it? "

      Yes, in fact I saw one from Google in the most recent quarter.

      You can call things what you like and even make up stuff if you want, but Wall Street and the analyst community cares about the cash earnings going forward, and those are expected to be much higher than the numbers that you choose to use.

    • Did Google pay yahoo? Then it was an expense. Who caresthat it was a non recurring charge. Have you aver seen a quartely report from ANY company that did not have a non recurring charge in it?

      Whats important is if they have the cash or not.

      Everything is a non recurring charge.

      Purchasing the land last week is a non recurring charge. why? because they will only pay for it once.

      Companies use nonrecurring charges as a way to pad earnings which is why analysts tend to include then in thier analysis.

    • He used 1.44 for Google's current earnings, which is the TTM GAAP number, which includes over $200MM in a nonrecurring settlement with Yahoo and over $200MM in noncash stock expenses. The true proforma number for 2004 EPS is $2.73. To show the math that proves that Mr. Hulbert used $1.44 (I wonder why he doesn't mention this number in his article?):

      1.44 initially
      after 1 year at 47.9% growth, 2.13
      after 2 years, 3.15
      after 3 years, 4.66
      after 4 years, 6.89
      after 5 years, 10.19
      Hulbert's assumed stock price = $525
      PE = 525/10.19 = 51.5, in agreement with Hulbert's assumed PE

      proving that Hulbert used TTM GAAP nonrecurring, and not 2005 cash, EPS.

      Yes, I agree that Mr. Hulbert's analysis stands... THE FACTS ON ITS HEAD! LOL

    • <<<<That analysis is incorrect, since Google will earn $4 in 2005 - so the PE is already about 50, so earnings will have to only grow about 20% per year to keep pace with the assumed 20% share price appreciation.>>>>

      PS to that article. I just reviewed the article again. He WAS assigning a p/e of 50 to the stock. I suspect he used just the February earnings report and multiplied by 4 so his analysis stands as far as I am concerned. He wasn't using 12 month trailing earnings or unproven future earnings. He was using current up to the minute earnings

    • View More Messages
 
GOOG
602.00+4.21(+0.70%)12:18 PMEDT