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Google's (GOOG +0.1%) sell-side PTs have been surging as shares continue trading above $900...

Google's (GOOG +0.1%) sell-side PTs have been surging as shares continue trading above $900 following a torrent of I/O news. The I/O news demonstrates "Google remains one of the most innovative and forward thinking companies of this generation," gushes Topeka, which has raised its PT to $999. Baird's PT is now at $1,025, and Argus' at $1,065. In some respects, the mood resembles that surrounding Apple not too long ago.
Comments (17)
  • Of course it does, when all the lemmings left AAPL they put their money into GOOG. It was very obvious. The spread on forward P/E ratios is really gowing between the 2 companies. If Wall Street ever rewarded AAPL with the same P/E as GOOG it would've hit $1000 first.
    17 May 2013, 02:40 PM Reply Like
  • Quite some differences though... At $700 AAPL had 20% of its market cap in cash, with a 15 PE. At $900 GOOG has 13% of its market cap in cash (and no 1.5% dividend), with a 27 PE.
    Not double the valuation but close..
    17 May 2013, 02:57 PM Reply Like
  • remember what happened last time when analysts said apple would go to $1000 a share?
    17 May 2013, 03:33 PM Reply Like
  • Haha thats true.
    On the other hand Google is still growing and is really just starting to monetize a lot of there products(such as YouTube). At the same time they are future proofed with self-driving cars and Google Glass. I know that neither of these are making them money at the moment but that is because it is before their time. I think GOOG has a bright future and still has a lot of growth to go.
    I am long GOOG
    17 May 2013, 04:08 PM Reply Like
  • yea google is a great company but i really doubt advertising..and that is their main revenue source. So many people nowadays have adblocker (including myself) so don't need to watch ads on youtube or have ads pop up anywhere on the internet. Even so, i have never clicked on an ad in my life..unless by accident.
    17 May 2013, 05:56 PM Reply Like
  • GOOG is great @Sermer but I'd sell calls against your position and maybe even buy a few protective puts because a) revenue actually shrunk last quarter for the first time in their history (nothing wrong, just maturing) and b) this big money that left AAPL and went into GOOG looks like it's having the exact same trajectory of stock price run. And we know what happened to AAPL on their next 'less than awesome' quarter. I got very very burned holding all of my AAPL shares and was blind to the idea that it could crash so hard given their balance sheet and profitability. Please learn from my mistake.
    18 May 2013, 08:00 AM Reply Like
  • My thought exactly. What could possibly go wrong!!
    18 May 2013, 09:43 AM Reply Like
  • You make a really good point, but I don't think most internet users are so sophisticated. Advertising could be hurt by this, but how long have you used adblocker?


    For me, I like Google's ad business because their sponsored results often appear when people just want that specific site. While I don't usually click on sponsored links, they sometimes relate to my exact search results (like if I want to go to Virgin Mobile, I'll usually click the sponsored link since it's at the very top). Google counts that as a conversion, which means Virgin has to pay for it even though I'm already a customer and could have just as easily gone to the next search result.
    18 May 2013, 09:53 AM Reply Like
  • Goog will be a terrific short when the oppty is nigh. Hedge fund hotel. If Goog does a stock split, that would psychologically provide room for the stock to grind higher though...
    17 May 2013, 03:54 PM Reply Like
  • Am I correct to think they haven't split yet? They came out of the box around $90.
    17 May 2013, 04:21 PM Reply Like
  • Fundamentals and technicals aside, the perceived future growth rates for both companies are diverging. Though both have their ecosystems, Apple had always relied on hardware while Google has focused on software. The Street is concerned about margin pressures for Apple while they are wary about monetization with Google. Apple has always been able to protect gross margins with their product price point but Google has room for margin expansion with diverse software offering.
    17 May 2013, 04:05 PM Reply Like
  • Cheaper R&D and capex and higher margin over the long term usually with non-device companies.
    17 May 2013, 04:23 PM Reply Like
  • $999 PT? Why not $1111? GOOG is a fantastic company and I love their innovation model. It does not mean that just because a company is well-run, that its share price is fairly valued.
    17 May 2013, 04:08 PM Reply Like
  • Software companies are always more profitable than hardware companies and have many more opportunities to improve margins.
    17 May 2013, 04:17 PM Reply Like
  • ok another stock to short big times once it reaches $1,000 like Apple....somebody is going to make big money
    18 May 2013, 09:55 PM Reply Like
  • GOOG reminds me of BIDU - it eventually peaked at 1500's - not a good idea to bet against this one. It's one of the market/sector leaders in this bull market leg. This company has a lot of EPS changing products coming out.
    19 May 2013, 12:15 PM Reply Like
  • Something uniquely different between the two companies now is that fact that the founders are still running the Google. The passing of Steve Jobs was the worst thing that happened to Apple. In its price run-up, people were paying for what I thought wasl the 'Jobs premium'; the last products and vision he left behind. From a Mac-fanatic, I hope Jony Ive beats expectations.
    Google still has its edge, Sergey and Larry, who are like Steve Jobs if Jobs had a programming background. In their own way, they can 'connect the dots.'
    19 May 2013, 07:46 PM Reply Like
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