GOOG: Google
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- DellaO
- Hu
- SteveT
- DellaO
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- DellaO
- DellaO
- SteveT
- SteveT
- Normxxx
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» Hu - Re: What About Google?
In response to message posted by DellaO:Where will Google be priced when it comes to market?
Somewhere between Jupiter and Pluto.
What is it worth?
Probably the moon.
Anybody buying?
Not a chance. Won't even be under consideration until it returns to earth. (Unless it crash lands. Then, it'd still be out.)
-- posted by Hu
» DellaO - Like All Things, Google Keeps Ambitions Quiet
.http://www.mercurynews.com/mld/mercuryne...
-- posted by DellaO
» DellaO - Just a Second-Hand Rose
.EC: You guys that voiced your opinions here, sure verify what this columnist had to say.
Posted on Sun, May. 02, 2004
The thrill is gone, Google; but it's not you, it's us
By Mike Cassidy
Mercury News
Do you feel it?
Me neither.
Google filed the paperwork last week to sell its stock to the public. Say it over and over. IPO. IPO. IPO.
Anything?
Thought so.
Face it, the words liquidity event just don't bring the tingles like they used to. Sure, it's encouraging to hear that somebody is succeeding and about to go public. (And if you work for Google, well, tingle away.)
But, for the valley-at-large, the giddy is gone. The zippity-do-da is done. The whoopee is wiped out.
Which is probably a good thing. You can't be young forever. Even Elvis faded.
The Google IPO has been described as everything just short of the second coming. The fact is, it is the second coming -- and that explains the tingle factor.
How many things are just as good the second time around? We had the boom and it was a thrill ride. Even if Google is the start of something big (a dangerous assumption), it won't ever be like the first time.
Who talks about their second kiss, the second man on the moon, the second woman on the Supreme Court? Who shouts: ``We're No. 2; we're No. 2?'' How often have you looked in someone's eyes and said, ``You're my second and only?''
Second times are different. More sober. We are more mature the second time around. We've been to school. Whether we've learned anything is an open question. But the flutter, the flushed-face sense of soaring possibilities? All that's for the first time.
Truth is, for Silicon Valley, the Google IPO following the boom years launched by Netscape is ``Jaws: The Revenge'' following ``Jaws.''
The sequel never lives up to the original.
Oh, we've tried. The media has been all over Google for weeks. Google has everything a Silicon Valley story needs: The Stanford kids. The starting in a garage. The silly name.
Time, Newsweek, the national newspapers have covered the company from every available angle. I kept waiting for someone to write a story about how Google spelled backward is Elgoog. Maybe I just missed it.
Despite the hype, the thrill is gone. Of course, dear Google, it's not you. It's us.
We are older and, we can only hope, wiser.
Yes, the Netscape IPO was a blast, all right. Raised $2.3 billion its first day. Made secretaries into millionaires. Stocked the parking lot with Porsches, Ferraris and BMWs of all shapes and sizes. It put loony smiles on the faces of people you'd never seen smile before.
All those kids, with nothing to sell and no profits to show, were rich. Really rich.
It was the American dream after a visit to the Balco labs. Powerful stuff. Powerful days.
Those were the days we were secure in our superiority. We were the talk of the nation and we were too cool to notice -- except when nobody was looking. We bought the $1,500 balsamic and the Webvan stock. We popped the corks and drank the Kool-Aid.
Remember the 64 millionaires a day? And so what if we were never part of the count? It rubbed off. The energy. The optimism. OK, the greedy thought that hey, if that dope next door can become a millionaire, I surely can, too.
OK, so maybe we overdid it. Maybe we were a little too secure in our superiority. Or maybe we weren't superior at all.
And of course, everything changed. And Netscape.
Well, there is no Netscape now. But there is Google.
Do you feel it?
Me neither.
-- posted by DellaO
» SteveT - Re: Just a Second-Hand Rose
In response to message posted by DellaO:http://cbs.marketwatch.com/news/story.as...
'Googlebay' renews dot.com craze
Seven tips before you consider bidding on this hot IPO
By Paul B. Farrell, CBS.MarketWatch.com
Last Update: 6:57 PM ET May 3, 2004
ARROYO GRANDE, Calif. (CBS.MW) -- There's a thin line separating optimism from irrational exuberance, and American investors are about to cross it again, just as they did back in 1995 with the Netscape IPO.
Will you be one of the millions of American investors to cross this line? Will you relapse into the irrational exuberance of the late 1990s? How will you know? You'll know when you bid on Googlebay!
Yes, Googlebay. That's my nickname for the new Web site that will handle bids for the upcoming Google initial public offering. It will launch soon. It will be offered on the Internet like any other online trading account, but in a Dutch auction.
Why go back four centuries to 1593 and the Dutch tulip-mania craze for historical precedent? Because America has eBay as a model, a modern online auction offering so much more than tulips! And since the Google IPO auction is being run in-house, Googlebay is the perfect nickname for the Web site and bidding process.
What could be more fitting to the moment: Google's got America ga-ga, giddy and giggling again. And eBay reminds us of the best moments of the late nineties, the ecstasy of Nasdaq 5000, the hysteria of 100 percent plus annual returns, the adrenaline rush of online trading and the promises of big killings and early retirements. Go Googlebay!
Absurd P/E ratios and silly valuations
Stop, dammit! Listen to yourself! It's happening again! Get a grip!
Not one of America's 94 million long-term buy-and-hold investors with an ounce of self-respect and a brain in their heads should participate in this idiotic bidding process.
Stick with your boring well-diversified portfolios. If you need an "auction fix," log onto eBay and buy something. Buy anything! But avoid the Googlebay auction like the dot.com plague.
Remember, folks, the S&P 500's historic price-to-earnings average is in the 15-17 range. It's bad enough that the P/Es of tech sector funds now are almost three times the historical level, at 42.5, according to Morningstar.
And yet, suddenly this absurd dot.com retread, Google, is pushing America further out into the heady irrational exuberance stratosphere of the late nineties.
Is Google worth almost as much as Oracle?
For example, Yahoo is already trading at 85 times projected 2004 earnings, and eBay at 70 times. And now Barron's is hyping Google's stock even before the bidding starts. And what grand hype! They use Yahoo's P/E and Google's $2.00 earnings projections to fry their readers' brains with an estimated $170 share price and $50 billion valuation for Google, ridiculously close to Oracle's $58 billion.
Frankly, Barron's is not only doing a disservice to investors, they raise serious questions about their own credibility by creating such dangerously high expectations.
Remember, this is the kind of press-hype that got Main Street into a helluva lot of trouble back in the late nineties, ultimately pushing us headlong into the bear market of 2000-2002, with a 43 percent drop and an $8 trillion loss of market capitalization and hundreds of dot.com bankruptcies.
Yet, here we are again! On the edge of a bid on the Googlebay dot.com.
Don't get trapped in the 'rapids'
Still not convinced by my warnings? Still feel compelled to plunk down some of your mad money, that stash of cash you tuck away for Vegas trips, office pools, Lotto tickets and hot stocks?
Here's a checklist designed to force you to think deeper about the insanity of bidding on Googlebay. This checklist was originally developed by James Gottfurcht, president of Psychology of Money Consultants. It reflects some of the better thinking from the new science of behavioral finance, the study of the investor's brain in action.
Hopefully this checklist of psychological traps will keep you on this side of the line, in the arena of healthy optimism and rational thinking, and keep you from careening back into a late-nineties time warp. Gottfurcht's anagrammatic checklist, RAPIDS, was developed to force investors into seeing how we self-sabotage our decisions:
* Rationalization. We resist anything that contradicts our expectations. For example, the real possibility that Google may be worth much less than $100 a share, not $150. Or have a P/E below 50.
* Avoidance. Investors are notoriously bad timers. We think too much. Or too long. We hate pulling the trigger, so we delay sell decisions. Or wait and buy late, near the peak. Our delays increase losses, minimize profits. Is $150 too high? Will you sell if it's below $50?
* Projection of blame. Investors hate to make mistakes. And hate to take responsibility. So we blame bad decisions on someone. Anybody. Plus we make flip decisions going in, like ignoring the fact that Google stock has absolutely no place in a well-diversified portfolio of funds.
* Idealization. The high-minded rhetoric in Google's filing is too good to be true. Pep talks about putting the little guy on a level playing field with Wall Street. New Age sweet talk about "making the world a better place." Bull. This is an investment, not a marriage.
* Denial. When investors can't rationalize bad news, they erase it. Our brains work overtime to screen out bad news, like Microsoft or Yahoo developing a better search engine.
* Splitting off. When it happens, the shock of a big loss often triggers brilliant insights. Then in a flash, guilt follows as you realize how totally irrational you really are. So you may overreact again, sell everything and swear off investing forever.
Behavioral finance experts see all this as a natural cycle. Your brain is riding a psychological roller-coaster and you cannot disengage yourself from the grip of this mix of greed and fantasy that creates a bubble on the up-cycle (1995-1999) before we cascade down the "rapids" into the hangover of a bear market (2000-2002).
Warning: Google stock has no place in the portfolios of America's 94 million passive buy-and-hold investors. And if you do submit a bid on Googlebay, remember, you have crossed that thin line, surrendered your optimism and once again drifted blindly into irrational exuberance!
-- posted by SteveT
» SteveT - Google's Web Ad Gamble: Is This Time Different?
http://www.reuters.com/newsArticle.jhtml...Google's Web Ad Gamble: Is This Time Different?
Mon May 3, 2004 11:16 PM ET
By Lisa Baertlein
SAN FRANCISCO (Reuters) - Google Inc. made its name from Internet searches but made its fortune from Web advertising, a near-total reliance on a single revenue source that presents risks for prospective investors, analysts said on Monday.
As it marches toward an initial public offering, Web search giant Google Inc. appears to be following the lead of an earlier generation of Internet firms that bet the farm on online ads and lost when the dot-com bust saw demand for banner ads evaporate. In 2003, 95 percent of Google's revenue of $961.8 million came from a new type of targeted advertisements.
This time around, Internet advertising is a seen as a far more resilient market, but analysts said that depending on it alone it is not without risks for Google.
Google, along with Web search provider Yahoo Inc. (YHOO.O: Quote, Profile, Research) , makes money providing "paid search" services that deliver ads when users type in certain key words. For example, if a user types "laptop computers" into a Web search engine, they will see ads from such computer sellers as Dell Inc. (DELL.O: Quote, Profile, Research) and Gateway (GTW.N: Quote, Profile, Research) in addition to other noncommercial Web search results.
Advertisers quickly learned that key-word ads were terrific lead generators and easier to track than other kinds of ads. In fact, they have become so important to online marketing that the fortunes of some businesses rise and fall based on how high their ad appears on Google -- a dynamic that is pushing up advertising costs and squeezing out some small sponsors.
"I'm sure I'm not alone in rooting for others to take away Google's market share," said one advertiser who now spends around $110,000 a year with Google and requested anonymity.
U.S. spending on paid search advertising more than doubled to reach $2.5 billion in 2003. That growth is expected to cool this year, when paid search is projected to hit $3.2 billion and account for close to half of all online advertising spending, which is forecast at $8.4 billion, according to Internet research company eMarketer.
Google, which shared $504 million in ad revenues with its various distribution partners in 2003, controlled roughly 20 percent of the paid-search market last year and was effectively one of the biggest ad agencies on the Web.
While overseas growth could further bolster ad revenues at Google, the company cautioned investors in its prospectus that ad spending has historically been tied to economic cycles.
RESURGENT RIVALS, OTHER CHALLENGES
Yahoo, meanwhile, has closed the gap on Google since spending $1 billion last year to buy search provider Inktomi and Overture Services, the pioneer of paid search advertising. Microsoft Corp.'s (MSFT.O: Quote, Profile, Research) MSN Internet unit is building its own Web search service and exploring a move into ad services.
If they were to steal key traffic partners like AOL (TWX.N: Quote, Profile, Research) or Ask Jeeves (ASKJ.O: Quote, Profile, Research) , Google's revenue would suffer. Competition also could prompt Google's partners to demand a bigger share of ad revenues, which would also dampen growth.
Elsewhere, some small advertisers say Google's success is making it harder for them to do business on the Web.
"Trying to get noticed on the Internet is just really frustrating," said Paul Obis, owner of a magazine subscription firm called Owlly.com, who has had difficulty finding an inexpensive and effective way to advertise on Google.
Other political groups, including a nonprofit critical of the cruise industry's waste dumping practices and a California vendor of T-shirts criticizing U.S. President George Bush, have complained that Google has blocked their ads much in the way that television network CBS (VIAb.N: Quote, Profile, Research) refused to air a Super Bowl ad from the political advocacy group MoveOn.org.
Various legal threats also loom.
Yahoo, through Overture, has sued Google, charging that its ad technology violates an Overture patent.
Google has lost trademark infringement lawsuits in France but prevailed in Germany. The company is litigating numerous similar cases in the United States, Germany and France.
"As of yet, we don't have crystal-clear resolution on the issue," said Rose Hagan, senior trademark counsel at Google.
-- posted by SteveT
» Normxxx - Playing the IPO Game. . .
Playing the IPO Game. . .
There's a normal path for IPOs to take that you have to understand if you're going to play the IPO game (since most of us can't get in on the initial offering). Without going into too much detail, there's the initial release, which can result in skyrocketting stock prices and much financial press.
Then after one or two weeks, the IPO will cool down and retrace. However, after the quiet period, the investment banks involved in the lead underwriting will pump up the stock - raise estimates, start it with a strong buy. This is so they can create liquidity for some of their larger clients who were given shares to flip their shares to the unsuspecting public.
(Granted the Google IPO is being release slightly differently, it's still a process that's skewed against the individual investor. The gimick seems aimed at drawing in more unsuspecting investors to get a higher price than otherwise.) After this period, the stock will then hit the lock up date, where more shares will be released into the market and the IPO will continue to drop.
Let the IPO establish a top and bottom in price action and only enter after it creates a solid base and breaks out of it. Granted that's a lot of waiting, but if we're setting a long term top in the market right now, the Google IPO may just represent the significant event marking a top for the market that people will point to in the coming months.
But that's just my opinion.
-- posted by Normxxx
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