It is a classic psychological reaction: when a child loses one parent to illness, every time the surviving parent comes down with a bad case of hiccups, the child assumes the worst.
Traders, while remaining cautious and suspicious, need to guard against such convention on Google (GOOG), even if they are still scarred by Apple (AAPL). There is no reason to believe, with what we know so far, that when it comes to CEO illness, Google is the next Apple.
Granted: it's been a strange few days. Larry Page, Google's well-regarded CEO skipped this week's shareholder meeting. The company claimed he had a throat condition. Fair enough. But that's where it admittedly gets somewhat weird: Page will apparently also miss Google's big developer conference. Oh, and-Google's second quarter earnings conference call.
He has a voice issue that will keep him on the shelf for weeks?
Could be. It is metaphysically-and medically-possible. Several relatively minor throat and vocal chord conditions require several weeks of relative silence. But Page also hasn't been posting on Google+ in a few weeks. That's rare. He is a regular poster and writing, of course, requires little in the way of vocal chords. Still, maybe he is just resting. That tends to be recommended too.
Yet Google's stock got hit on Thursday by the uncertainty and by Friday, questions were blowing in the wind, including in a headline from The Wall Street Journal:
"What's Ailing Google's Chief?"
Page issued a statement. It offered reassurance, if with vagaries that were evocative of a few of Apple's infamous statements about Steve Jobs' health. Page assured that he would "continue to run the company" and said "there is nothing seriously wrong with me." That echoed Apple's claim that Jobs merely had a "bug."
But that's where the parallels with Apple, at least at this stage, end. Apple's claims furrowed brows because Jobs was indescribably thin and frail, obviously not doing well. Apple all but asked you to believe them instead of your lying eyes.
Google, which should be doling out more detail, is at least doing nothing along those lines.
If Page's physical appearance declines, or if his respite extends weeks past what is promised: reevaluate. But for now, remember that the parallels between this pair of CEO illnesses does not seem to extend far beyond the surface. Moreover, Google does not have a history of asking you to take leaps of faith. That counts for something and probably means that in the absence of an obviously dark turn of events, the stock's P/E won't contract.
This is where traders have to perfect the fine art of avoiding panic, while remaining suspicious. The key is to remain in a state of readiness for the next piece of information and that's a challenge in any situation, much less one in which everyone from Microsoft (MSFT) to Yahoo (YHOO) is trying to kick Google in the shins.
But do not panic. Do not bury Page under the supposition that the first part of this story sounds suspiciously like Apple's, so it must mean a shared fate.
Sometimes a bug is just a bug.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
