What can’t be googled

Date: 2006-10-20

Ticker: GOOG

Event:: GOOG 3Q result release

Title: What can’t be googled

Content:

After YouTube acquisition, on its way to $500, Google gets another big boost today from its 3Q results. The stock may jump to $460 driven by the news, only $40 below the historical moment. My current feeling is it should at least kiss it once in short term and then show respect to gravity.

The EPS is really somewhat absurd if we looking at the numbers. Financial sector companies usually have a habit to widely beat the expectations due to their secret operations. But for Google, this is just to say the market is too volatile and hard to predict. Actually, this time triumph is not as good as previous two beats, 12% and 16%. But it’s not linear and don’t forget the expectation is already very high.

At current level, pessimism and optimism should reach a balance. Margin is good but maybe near peak, expansion is good but facing keener competition, core product is good but too single-handed. But, but, but……

But uncertainty is exciting.

Google has a good “heart”, huge free cash to prey as many preys as it wants, bubbled online companies as downstream, and tons of talents in its ideas reserve bank. How many catalysts you want, how many they get.

Just watch out Vista, it may be a big blow to give Google a short heart attack. Anyway, it’s something going to happen on the way to be a grown up.

Market should be efficient speaking of Google’s long-term prospect. But it would be still one of the hottest stocks to challenge any investor’s sense and sensibility in short term.

It's something unpredictable, but in the end it's right.
I hope you had the time of your life.

-Green Day, “Good Riddance”