Monday, February 13, 2006

The Google Meltdown

The sell off of Google continues it seems. Barron has put out an article that is speculation but if correct could see Google drop in share value by 50%. It seems the market is reacting to that news as Google has lost a further 5.39% at this moment with a share costing $343.08 when on January 11th a share traded for $475.11. Since that highwater mark, the stock has lost 24% of its value.

There are analysts who are still saying Google is a good buy and even still say $500 a share is possible. CitiGroup is saying $490 is possible. I think these are analysts who are trying to prop Google up just to keep their track record good along with their salaries. Look at the share prices for Yahoo! are $32.02[lets remember it seems Yahoo! sold out a dissdent to the PRC] and Microsoft shares are $26.57. I am an amatuer but when one compares Google share prices to their competitors, it seems Google is grossly over-valued. Also consider Microsoft is far more diversified in its market penetration that Google is so it can better survive a downturn in online advertising than Google, though Google is trying to branch out but its practices in regards to books may violate copyright laws and its video distribution network has left many unimpressed.

So I am going to side with the pessimists when it comes to Google, expect its value to continue a decline as the speculators are shaken out of the equation. Will Google drop to $180 a share or a mere $100 a share, time will tell. But the Google bubble is well and truly popped I think.


Anonymous said...

Just like the dot com bubble of the 90's. Why should some company which has no tangible assets and in reality produces nothing tangible be even worth $100 a share? And the lunacy continues.


Mike's America said...

Had I been smart I would have bought a boatload of Google at it's IPO.

But I imgaine I would have sold it after it doubled and would now be kicking myself.

Frankly though, I wouldn't mind if it did take a huge cut. After they sold out to the Chinese, and some of the other things this bunch of leftists have done, it's time for some capitalist payback.

Anna said...

Well today the slide continued, even as the Dow topped 11,000. That should say a whole lot.

Seems this 24% loss in value equals to a loss of $40 billion, wow. But the three top guys at Google won't care since they have sold off stock to the tune of $3.7 billion. Google could tank right and they would still be rich.

Anonymous said...

That's the problem with the dot coms, the owners make a fortune and the investors get a cleaning when the stock tanks