That’s not something we’re used to hearing, but since its peak back in the Fall at nearly 750, Google has dropped to 584 currently, a 166 point drop (it’s dropped more in after hours, all the way down to 568). It’s on a steep decline in the past few days, perhaps due to the new search stats from Nielsen, as well as jitters about the economy at large.
I can only imagine what this is doing to the Google culture. Don’t tell me no one watches the stock there. Anyone who’s joined since September of 2007 – and that’s a lot of folks – now find their options underwater.
The culture is taking its first deep breath. Recall my predictions from a few weeks ago: 2008 will be the year Wall Street gets frustrated with Google. The company has incredible numbers, and will continue to impress, but analysts, tired of bidding up the stock, will start to question the company’s myriad ocean-boiling projects – after all, it’s merely trying to reinvent Health, Energy, Telecom, IT (both consumer apps and OSes), and a few other major portions of the GDP. Look for a few querulous analyst reports and even a few downgrades by the end of the year, as Wall Street finally comes out of its honeymoon stage with Google and demands that the company consolidate its control in marketes where profits are secure: Search and Adsense.
Is this the start of it? It could be. Earnings are coming, and they will be the key to the story. Right now, Wall St. isn’t in love with Google, or any other stock, to be sure. A great quarter – which Google consistently delivers, by the way, could change that.
Great post! They will drop approximately 200 points if they miss their numbers as Apple just did.
dear John, on the frontpage (22january) is see a stock crash of Google. Maybe it would be nice to compare this crash with Microsoft as this post suggest? I am quite interested in this matter. Are you planning to write more about this?
best regards
Bob
I agree this was a great post, John. As scary as it is, we all have to hear about the big companies dropping. I am sure it is due to the current economic state as you had mentioned. I find it very worrisome, as everyone in the country is at this current time. I have been trying to start my own internet business, Google is huge. I wanted most of my articles and blogs on Google as they will get more viewing there. James Brausch designed some software which scores your domains and URLs. All you have to do is put in the list of URLs and domains and click score. It was very simple and it came with videos to show you how easy it is. Once you hit the score button each domain and URL is scored which enables you to see which ones are scoring highest. If you choose the higher scoring you are about 15% and up higher rankings than if you do it on your own. It will give you the advantage over all those other internet marketers out there. Why use a low scoring URL or domain, when you can be at the top? See what I am talking about at http://www.nemeas.com
Hey John – The question is … Will the insiders, that haven’t already, begin to ‘cash out’?. Considering that the Tech sector (and M & A) is really the solid hope the market has this year, no doubt it’s going to be fascinating to watch.
I really don’t see Google’s recent drop being anything other than a part of a larger market correction. I think people need to start facing the reality that we are in a recession and the US economy is in the midst of an economic crisis. Not only do the financials support this with lenders getting destroyed, inflation, high government spending, etc., but now the bullish views of the market are no longer shared by the “common” man and he is pulling his money out of the market entirely or into safer plays that typically perform better during economic downturns.
All foreign markets were down 4.5% today or more – I really don’t see Google as being the market leader here as there are much deeper economic concerns.
This correction is hitting some people really hard – others not so bad. What makes the difference? Not putting your eggs into one basket.
Sadly not too many of us do that. Its the same with web traffic for many people. Not to knock google, but way too many webmasters place all their efforts into ranking in google when there is a ton of traffic to be had from other sources – traffic that helps keep things in balance when changes happen in rankings. If you set things up properly so you aren’t reliant on one place for your results – for example as James Brausch suggests in his blog at jamesbrausch.org, you end up with a much more stable business (or portfolio).
Very interesting post that really helped me keep this in mind.
Cheers,
Eric
Perhaps THAT is why they just made this very important announcement about an innovative Advertising partnership with Publicis:
online.wsj.com/article/SB120104506513408095.html
nytimes.com/2008/01/23/technology/23ads.html
Too bad the spammers on SearchMob ruined it for everyone -ain’t it
Search Engines Web: Perhaps that is also why they are now trying to tap into Universities/academia, to get researchers to do their advertising work for them.
I mean, come on. Do they really expect us to believe that this contest was “Developed by professors in collaboration with Google”, as it says in the very first sentence? Like a bunch of professors showed up and said to Google, “How can we help you study the advertising process better? What research experiments can we professors develop and evaluate for you, Google, that will better further your advertising, money-making goals?”
I could believe “developed by Google, in collaboration with professors.” But the other way around? Naw.
The arrival of the bear market provides some good cover for analysts who have infalted the stock to its ludicrous high of the end of 07. It’s a great time to ditch the stock without losing face.
The arrival of the bear market provides some good cover for analysts who have infalted the stock to its ludicrous high of the end of 07. It’s a great time to ditch the stock without losing face.
—–
http:www.vcao.net
Interesting post, John. But consider the big picture: Is the market frustrated with Google, or is the market frustrated in general?
Already started: Google lost market share this last time around (to all people MSFT!).
Or it could have been when they got special landing rights for their 747 over a residential area. Or when the founder gave Google funds to his wife for her company. Or when the EU lambasted Google for privacy violations. Or when Google said Do No Evil, except when making cash in China (and then later apologized).
Hmmmm… Money hides lots of things. But when that goes, wow, look out.
cool, it’s been too high. I’m looking forward to buying more Apple and Google stock in the near future (after it settles a bit). It may be scary now but I’ve got a good feeling about 2008 and tech stocks. Yeah, may go down a bit early on but I think the later half of the year will be great.
There’s no real story here, it’s just tracking the market:
5 day:
GOOG: -10.63%
Nasdaq: -7.50%
1 month:
GOOG: -16.12%
Nasdaq: -14.84%
3 month:
GOOG: -10.19%
Nasdaq: -16.76%
Take a look at http://finance.google.com/finance?client=ob&q=GOOG and add Nasdaq to the graph. The 1m view demonstrates this best. Sure there was a correction from the crazy high, but the recent declines are just part of a more general fall.
Hi John, Great post. On my side, I posted my Y2008 forecast for the GOOG stock, originally in French on my blog but translated on Google.finance here: http://finance.google.com/group/google.finance.694653/browse_thread/thread/108dd697e03e619d/793139b0890cd067
When I wrote how strange it was that GOOG seemed to know no ceiling ( twitter.com/nmw/statuses/398137172 ) , it was near it’s peak — but lost 15% over the next 3 days.
Over the past 3 months, MSFT has outperformed GOOG — but at least GOOG is still better off than C ;D
Right now GOOG is 2% down in Frankfurt, but the TecDAX is down over 6% (and the DAX itself is down about the same amount).
Google is definitely down, and facing tight against its trendline. If it bounces off it, then I think it’ll continue going up. BUT, if it breaks down through it, watch out!
Good post,
j. Bruce
http://www.SalesDrivenMarketing.com
Advertise effectively on Yahoo and Google today!
short-term stock-analysis is for suckers…
let’s see how your prediction fares by december.
-bowerbird
Re-read their annual reports for the last few years. Even new employees get “Google Stock Units”, which vest like stock options but can’t go underwater. I’m sure Googlers watch the price, but I’m guessing they’re not as frantic about it as they would be if all they had were conventional options.
Hiring people after 9/07 who expect to make a meaningful amount of money from stock options would automatically mean we should short the stock; if that’s the case, hiring standards are in the dumpster.
What happens at Google on days when the stock rises? One answer can be found in this report, which John liked to earlier, about the company’s internal prediction markets. The stocks representing ‘good’ outcomes in the internal market shoot upwards when GOOG stock is doing well.