Target: Google

Barron's has a reputation for hitting the darling of the moment in the groin, and this weekend that darling is Google. I have a WSJ sub, I'm not sure this link is open. If it's not, highlights: INVESTORS HAVE BEEN FIXATED on Google the past few weeks, as its…

Barron’s has a reputation for hitting the darling of the moment in the groin, and this weekend that darling is Google. I have a WSJ sub, I’m not sure this link is open. If it’s not, highlights:

INVESTORS HAVE BEEN FIXATED on Google the past few weeks, as its shares have tumbled nearly 25% from a peak of $475 — and the fact is, there could be a lot more tumbling ahead. The share price could well be cut in half over the next year as the Internet giant grapples with growing competition from Microsoft and Yahoo!, increased pricing pressures in its online ad sales and mounting concern about what’s known as click fraud.

..Over the next year, both Yahoo! and Microsoft’s MSN portal are expected to improve their search offerings. In the second half of this year, Yahoo! hopes to improve its systems so that search-engine ads are more relevant to search results and therefore more likely to be clicked….

…Last week, news came out that has jumped into the game through its network of “associates” — Websites that have links to Amazon and receive fees when readers click the links and buy products. Amazon is offering to place ads from a third party on affiliates’ sites; Amazon and the affiliates would then split the revenue generated by clicks on the third-party ads….

..Finally, there’s the matter of persistent insider selling. As Google starts to spend the $5 billion it raised through two stock offerings in the past year and a half, its senior executives have aggressively sold shares. Co-founders Brin and Page have each sold more than $1.5 billion of stock. CEO Eric Schmidt sold $493 million. Omid Kordestani, senior vice president of global sales and business development, sold $793 million, and Ram Shriram, a director, pocketed $442 million, according to Thomson Financial.

Granted these folks all continue to have substantial holdings in the company, and most of the sales were part of pre-arranged selling programs that Google asked these executives to establish at the time of the IPO. Still, it’s notable that none have purchased shares in the wake of the recent stock pullback. Investors might be wise to follow what they do and not what they say.

4 thoughts on “Target: Google”

  1. AnooX is why Google is down and will go down MUCH more

    I think the reason for Google demise is this new
    search engine called Anoox. You can find it here:

    Because it is fundamentally a quantum leap ahead of
    Google or Yahoo in giving value to the Internet community, which is simply because they are a Community based (essentially not-for-profit) business.

    Some of the reason I will write about here quick:

    1- Anoox is open source, and distributed. This way
    many world wide will control Anoox search engine.
    This is the Internet model. Google & Yahoo are
    the TV model.

    2- They promise to not enter any other business
    but search business. This is great news for small to
    medium size businesses world wide. Why would we after
    all want to use search engines that can any day turn
    around and be in competition to us and surely kill us
    as result.

    3- Anoox search results are in many way better.
    Because they are machine generated and then Optimized
    by the majority Vote of the people.

    4- Anoox advertising rates are like 90% lower
    than Yahoo & Google. Because of their community
    based biz model.

    You can read about why AnooX search engine model is better
    in detail here:

    Given all these reasons, many are going to switch to anoox.
    I know myself as a small biz owner and everyone who works
    for me is. After all why would I want to pay 90% more in
    search engine pay-per-click Ad rates to Yahoo & Google and
    on top of that not have the assurance that tomorrow Y & G
    will not be entering my business when I have this assurance
    from anoox!

    PLEASE: Google share holders do not attack me.
    Don’t shoot the messenger. I am just saying it
    as I see it.

  2. The important thing to get about GOOG, the stock – as opposed to Google, the company – is that the stocks of even the GREATEST companies can be bad investments. As they say, (ahem) “over-valuation happens.”

    A corollary to this point: The relatively common practice of thinking, “It’s a great company. I’m just going to buy the stock, and it’s going to work out in the long-run,” is based on a FALSE assumption – and may cost you dearly.

    Whether you believe GOOG is going up from here or down, at least you should be clear about the very important distinction between the stock’s prospects and the company’s prospects.

    “But if the company’s business is just growing like CRAZY!, you just wanna own the stock – don’t you?…”

    The answer to which is: No. Not necessarily. Very often yes, but not necessarily. And GOOG may well be such a case….

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