Thu, Jan. 8, 9:59 AM
- Believing "the best days for shares may be behind it," Stifel's Scott Devitt has downgraded Google (GOOG -1.4%) to Hold. "Google is in the early to mid stages of a core business maturation. The company continues to find growth outside of search, but in structurally lower-margin business [segments] such as Google Play and YouTube."
- Devitt adds Google will face stiff competition as it further expands into vertical search categories such as travel, local, and e-commerce - some of those efforts have been faring well - and echoes other analysts in arguing Facebook's growing share of digital ad spend poses a threat.
- Devitt has also downgraded Priceline (PCLN -1.3%) to Hold, citing concerns about forex - the impact of a weak euro is already well-known - high marketing spend, and growing competition. "The online travel market continues to benefit from secular tailwinds such as mobile adoption, but we believe that shifts in the competitive landscape and macro headwinds warrant a moderate 2015 outlook."
- TripAdvisor (TRIP +0.4%) has been cut to Hold due to worries about delayed booking service launches and higher marketing spend, as well as growth concerns about TripAdvisor's core metasearch service (previous).
- Google, Priceline and TripAdvisor were already fairly close to their 52-week lows going into today. Google and Priceline both now trade for 17x 2015E EPS. Their 2015 revenue growth consensus estimates are respectively at 19% and 17%.
Thu, Jan. 8, 3:16 AM
- Google’s (NASDAQ:GOOG) slice of the U.S. search market, excluding mobile devices, fell to 75.3% last month from 77.5% in November, while Yahoo's (NASDAQ:YHOO) share jumped to 10% from 8%, according to analytics firm StatCounter.
- The changes were spurred by a deal in November where Yahoo replaced Google as the default search engine on Firefox browsers in the U.S.
- Google is also facing potentially larger losses on mobile devices amid reports that Apple is considering dropping it as the default search provider on its Safari browser.
Dec. 31, 2014, 8:43 AM
- Among the more interesting is the idea of North Korea hackers attacking the infrastructure of the NYSE and Nasdaq, precipitating a gigantic one-hour drop in stocks.
- Others include: 1) Significantly higher Apple (NASDAQ:AAPL) estimates, making it the first $1T market cap company, the best-performing large-cap in 2015, and a "must own." 2) Falling home prices in H2, making shorts of homebuilders (ITB, XHB) a good play 3) Bank stocks (NYSEARCA:XLF) have a hard time of it 4) Calling Twitter (NYSE:TWTR) his new Netflix, Carl Icahn amasses a sizable position, forcing a bidding war for the company between Google and Facebook 5) Google (NASDAQ:GOOG) becomes more shareholder friendly, cutting spending and launching a buyback program 6) Activists take aim at Cisco (NASDAQ:CSCO), forcing John Chambers out 7) Berkshire Hathaway (BRK.A, BRK.B) makes its largest-ever acquisition, and its not in consumer goods, but instead in energy, retail, or construction/equipment.
- The full piece is here.
Dec. 30, 2014, 6:41 AM
- A four-day outage of Google’s Gmail service in mainland China appears to have at least partly ended today, with some users reporting they have access to their accounts.
- Most of Google’s (NASDAQ:GOOG) services were blocked in China this past June, ahead of the 25th anniversary of the Tiananmen Square massacre.
- Gmail users have still been able to access the service through third-party email applications such as Microsoft’s Outlook or Apple’s Mail, but the service appeared to have been cut last Friday.
- Previously: China blocks access to Gmail (Dec. 29 2014)
Dec. 29, 2014, 4:25 AM
- Although Gmail’s website had already been blocked, China barred access to Google's (NASDAQ:GOOG) e-mail service through third-party applications as of Friday, including the Mail app built into Apple's iPhones and iPads.
- Google search and map functions were blocked in China earlier this year as part of the country's limited access to foreign news and tensions over cybersecurity and hacking.
- Traffic volume for Gmail dropped about 85% on Dec. 26 before falling further the following day and remains near zero today.
Dec. 24, 2014, 11:14 AM
- Sony (NYSE:SNE) plans to stream The Interview on its own site and make it available for rental through Google's (NASDAQ:GOOG) YouTube and Google Play, sources tell Re/code.
- Online distribution is expected to start tomorrow.
- Previously: Online launch of The Interview to be closely watched
Dec. 22, 2014, 2:15 PM
- Whereas prior Google (GOOG +1.7%) self-driving car prototypes lacked features such as steering wheels, headlights, and brake pedals - different prototypes focused on testing different systems - the Web giant says it has now "put all those systems together in [a] fully functional vehicle—our first complete prototype for fully autonomous driving."
- Nonetheless, Google's safety drivers "will continue to oversee the vehicle for a while longer, using temporary manual controls as needed while we continue to test and learn." The company presented a study last year claiming its self-driving cars already drive more safely in autonomous mode than when under human control.
- The WSJ reported on Friday Google is looking for auto industry partners to "bring its vision of a self-driving car to market within the next five years." Project director Chris Urmson: "We don’t particularly want to become a car maker ... We are still assessing the business model. We don’t know what the right relationship is."
- Urmson reiterates software, not hardware, remains the biggest challenge to bringing fully self-driving cars to market. Google maintains a target of launching one by 2017-2020.
- Driver-assistance tech leader Mobileye (MBLY -0.1%) is hoping to provide many of the hardware subsystems needed to make fully autonomous driving a reality. Its solutions are believed to underpin the advanced driver-assistance features recently launched by Tesla.
Dec. 19, 2014, 4:50 AM
- Building upon its current Android Auto software, Google (NASDAQ:GOOG) is laying the groundwork for a version of Android that would be built directly into cars.
- This integration would allow drivers to reap all the benefits of the Internet without plugging in their smartphones, as opposed to Google's current Android Auto software which requires a phone to be plugged into a compatible car.
- If successful, Android could become the standard system powering a car's entertainment and navigation features, although the move is likely to face heavy competition and various business challenges.
Dec. 17, 2014, 11:03 AM
- Pivotal Research's Brian Wieser has upgraded Google (GOOG +0.9%) and Twitter (TWTR +1.6%) to Buy in the wake of yesterday's selloff. His targets are respectively $610 and $42.
- Wieser: "We have been generally negative on Google since early 2013, given our ongoing concerns about margin erosion, intensive capital investment plans and diversification (also capital intensive often) away from the company's core advertising business." However, he now admits Google has grown faster than expected, and that margin erosion has been less than feared.
- Wieser is still concerned about a mix shift towards (lower-margin) display ads from search ads, and wishes Google (has no dividend or buyback program) would return some cash to shareholders. But he thinks those issues are now priced in.
- Regarding Twitter, Wieser still believes its core service "has only niche market potential at maturity," but considers the recent selloff overdone. He's also concerned about Twitter's management turmoil, arguing it could be a sign Twitter is "still trying to become something bigger than it presently is”
- Google made new 52-week lows yesterday following a JPMorgan target cut. Twitter closed near its lowest levels since June.
Dec. 16, 2014, 2:54 PM
- Though reiterating an Overweight rating, JPMorgan's Doug Anmuth has slashed his Google (GOOG -2.2%) target by $70 to $600, and also cut his estimates.
- Among other things, Anmuth cites "the transition from desktop to mobile search, continued margin compression, and increasing competition from Facebook."
- The indirect challenge posed by Facebook to Google's ad dollars was raised by some following Google's Q3 miss. Meanwhile, Facebook's Atlas (display ad-buying/measuring) and Audience Network (mobile ad network) platforms directly compete against Google's DoubleClick and AdMob units.
- The ability of Google search to deliver ads directly tied to user intent (i.e. what a user is looking to buy at a particular moment) still acts as a key selling point when battling for ad dollars. Facebook's ad targeting, by contrast, is often driven by previously-obtained user data.
- Shares have made new 52-week lows. Google now goes for 14x 2015E EPS exc. net cash/investments. The 2015 revenue growth consensus is at 17.7%.
Dec. 15, 2014, 7:02 PM
- The WSJ reports Google (NASDAQ:GOOG) has "approached retailers about creating a 'buy' button" for Google Shopping that would work much like Amazon's (NASDAQ:AMZN) one-click ordering feature.
- Google is also said to be "considering a [Google Shopping] marketing program that would allow merchants to promote two-day shipping." The program would be similar to one from ShopRunner that provides unlimited two-day shipping from various retailers for $79/year. Amazon Prime, of course, provides unlimited two-day shipping (among other things) for $99/year.
- Sources caution several retailers approached by Google were cool to the "Buy" button concept, fearing more price competition and a loss of control over the shopper experience. Google could profit from the button either by charging a transaction fee, or by simply seeing higher conversions when it's used (thus raising ad prices). The company might also get better conversion data than it's currently receiving.
- As ChannelAdvisor's data drives home, Google Shopping ads (deeply integrated with Google search) have been seeing rapid growth; Wal-Mart, Best Buy, eBay, and Sears are among their many buyers. Amazon, though spending plenty on standard Google search ads, is a high-profile holdout.
- Google officially launched its $95/year Shopping Express same-day/next-day delivery service (competes against Prime's same-day services) in October. Around the same time, Eric Schmidt called Amazon Google's biggest search rival, due to the fact Amazon shoppers are more likely to bypass Google search.
Dec. 12, 2014, 11:33 AM
- In response to a new law requiring Internet companies to store their users' personal data within Russia (seen by critics as an attempt at censorship), Google (GOOG -1%) is shutting down its Russian engineering office.
- Nonetheless, Google insists it will increase its business investment in Russia next year, and says it still has "a dedicated team in Russia" to support local users.
- Yandex (YNDX +4.2%) has rallied following the news. LiveInternet.ru estimates Yandex had 60% of the Russian search market in Q3, and Google 31%.
- Google shut down its Chinese search engine (Google.cn) in 2010 rather than continue censoring its results. This week, the company announced it's shutting down Spain's version of Google news in response to a law requiring it to pay publishers for excerpting content.
Dec. 11, 2014, 4:34 AM
- Google (NASDAQ:GOOG) is shutting down its Google News service in Spain due to new legislation that will require the company to pay publishers for displaying any portion of their work.
- "As Google News itself makes no money (we do not show any advertising on the site) this new approach is simply not sustainable," announced Richard Gingras, head of Google News.
- The company will close the service on December 16 and will remove all Spanish publishers from its international versions.
Dec. 10, 2014, 7:10 PM
- Google's (NASDAQ:GOOG) DoubleClick Ad Exchange came first in ad analytics firm Pixalate's study of the quality of the ads delivered by 400 real-time bidding (RTB) platforms. Pixalate says its analyzed 100B+ ad impressions, gauging metrics such as viewability, fraud rates, engagement, and domain masking (i.e. the disguising of the Web address an ad links to).
- Google/DoubleClick, which has been gaining display ad share for a number of years, received a maximum network score (measures the quality of ad domains) of 99. It also got high marks for inventory quality (92), viewability (96), engagement (90), domain masking (96), and fraud (88).
- Among publicly-traded online ad firms, The Rubicon Project (NYSE:RUBI) was a standout, coming in at #3. Criteo (NASDAQ:CRTO) also fared well, ranking #15.
- On the other hand, mobile ad network owner Millennial Media (NYSE:MM) was ranked #300. Millennial, bleeding mobile ad share to Google and Facebook (among others) over the last two years, is said to have a "high ratio of fraudulent traffic."
- RTB accounts for much of the burgeoning programmatic (automated) online ad market. eMarketer forecasts the U.S. RTB market will grow 123% this year to $9.25B, and total $11.8B in 2016. The adjacent programmatic direct market (covers the automated buying of entire ad campaigns from publishers) is expected to grow over 10x from 2014 to 2016, to $8.6B.
Dec. 8, 2014, 2:30 PM
- Facebook Search (FB -0.5%) has been updated to support searching for keywords within posts, photos, and other content that has previously appeared in a user's news feed. The feature is initially launching to PC and iOS users; Android support will arrive later.
- For now, Facebook doesn't plan to sell mobile search ads, or any new keyword-based ads in general. But as Google (NASDAQ:GOOG) can vouch, offering such ads could prove very lucrative long-term. While Facebook has a treasure trove of data about its users, it knows relatively little (compared with Google and other search engines) about what a user is interested in buying at a particular moment. Keyword searches can help change that.
- Product manager Rosseau Kazi says Facebook also plans to eventually provide keyword searches for publicly-shared posts, a move that would make it a bigger indirect threat to traditional search engines. "Facebook has a wealth of information you can’t get anywhere else."
- Facebook is also finally bringing Graph Search to mobile. Though launched to much fanfare in early 2013, Graph Search hasn't lived up to expectations thus far, as users found its approach to queries (for example, searching for all friends who live in Seattle who work for Starbucks) too complicated relative to standard search.
- Mark Zuckerberg reiterated Facebook's commitment to Graph Search in a spring interview, while adding the product is aimed more at mobile than PCs.
Dec. 5, 2014, 8:19 AM
- Noting search maturity, lack of product catalysts, and margin pressure to investments in competitive and long-duration businesses like cloud computing and retail delivery, analyst Justin Post says his team's estimates for Google (NASDAQ:GOOG) are lower than the Street's.
- Post also cites increased regulatory risk, particularly in the EU, strong Apple product cycle and search contract renewal uncertainty, and competition and reversal in U.S. online ad market gains due to social media.
- Post and team lower their 2016 EPS estimate to $33.81 on revenues of $73.72B vs. the Street at $35.77 and $73.4B.
- Shares -1% premarket
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