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#31
06-07-2005, 10:00 AM
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Re: Google.
sorry about misreading that. I wasn't born when msft came out with their IPO.
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#32
06-07-2005, 11:29 AM
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Re: Google.
[ QUOTE ]
He's saying that GOOG in 2005... Is a lot like MSFT in 1987. MSFT went public in March 1986... At $21.00/share... And was bid up to $27.50 on first day of trading... Roughly 20-25 times earnings. In 19 years... MSFT stock has increased in value 300 times... Which is a 35% annualized return.. [/ QUOTE ] Google is likely not at all like MSFT in 1987. GOOG is already worth $82 billion. I believe the biggest stock today is GE at ~$400 billion. If GOOG were to increase in value 300x, then it would be worth $24,000 billion ($24 trillion?). Not gonna happen in our lifetimes. GOOG may well become the biggest company on Earth, but expecting anything like a 300x gain from here is crazy. A 10x gain from here would make it twice as big as GE. That would be the uppper, uppper end of my expectations if I owned it. And I wouldn't expect that for at least 10 years. GOOG will soon run into the law of large numbers and it's growth will slow way down. That doesn't mean it's not currently a good investment, but it does mean that you won't see anything like the return investors who held MSFT in 1987 saw. To get a MSFT-1987 like return you should be looking at companies worth less than $1 billion.
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#33
06-07-2005, 11:32 AM
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Re: Google.
[ QUOTE ]
[ QUOTE ] He's saying that GOOG in 2005... Is a lot like MSFT in 1987. MSFT went public in March 1986... At $21.00/share... And was bid up to $27.50 on first day of trading... Roughly 20-25 times earnings. In 19 years... MSFT stock has increased in value 300 times... Which is a 35% annualized return.. [/ QUOTE ] Google is likely not at all like MSFT in 1987. GOOG is already worth $82 billion. I believe the biggest stock today is GE at ~$400 billion. If GOOG were to increase in value 300x, then it would be worth $24,000 billion ($24 trillion?). Not gonna happen in our lifetimes. GOOG may well become the biggest company on Earth, but expecting anything like a 300x gain from here is crazy. A 10x gain from here would make it twice as big as GE. That would be the uppper, uppper end of my expectations if I owned it. And I wouldn't expect that for at least 10 years. GOOG will soon run into the law of large numbers and it's growth will slow way down. That doesn't mean it's not currently a good investment, but it does mean that you won't see anything like the return investors who held MSFT in 1987 saw. To get a MSFT-1987 like return you should be looking at companies worth less than $1 billion. [/ QUOTE ] Excellent point. Welcome to the boards.
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#34
06-07-2005, 01:42 PM
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Re: Google.
I never implied that GOOG...
Has any chance of returning 300x in 20 years. But if it grows at 15% for 19 years... It will return 60x. You missed all the similarities to MSFT... And nitpicked on something I never said. Welcome to 2+2... You'll fit right in... That's how everybody behaves around here. Similarities GOOG '05 and MSFT '87 (1) Both difficult to understand tech companies. Just read this thread. This is a sophisticated place... But no one has a clue what GOOG is really about... Reason: You have to have a computer science degree... To even begin to understand why GOOG... *** Technologically *** Is such a threat to YHOO and MSFT. (2) Both companies shot out of the box... And where viewed as insanely overvalued... After 1 year public. (3) Both companies have done nothing... But make money for their investors. (4) Talent. GOOG is attracting the talent MSFT was in '87. The kind of stuff GOOG is building... World's fastest web-scale supercomputer w/custom OS, etc... Cannot be done by an army of MicroSerfs. (It takes MSFT 5 f*cking years... To foist a bug-ridden Windows upgrade on the world). You have to hire at 6 figure salaries... 50, 100 whatever top GENIUS level software engineers. Software Geniuses are a lot like Poker Geniuses... Born not made... and very quirky... And in very limited supply. They don't care about money... But care about interesting work and non-conformist culture. In general, a top PhD Computer Genius... Would never consider working for a MSFT... But would sign up with GOOG in a heartbeat. GOOG is actually more comparable to Apple '85. Anyway... In terms of talent and technology... GOOG is gonna roll over MSFT and YHOO. If you want detail... Go back and read my posts. rm+ [img]/images/graemlins/cool.gif[/img] [img]/images/graemlins/cool.gif[/img] [img]/images/graemlins/cool.gif[/img]
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#35
06-07-2005, 03:03 PM
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Re: Google.
[ QUOTE ]
But if it grows at 15% for 19 years... It will return 60x. [/ QUOTE ] ... and if I try real hard, I might be able to excrete a golden egg. 60x growth from here would put GOOG at a $5 trillion market cap. U.S. annual GDP in 2002 (the last year I can find) was around $11 trillion. I think there are some serious flaws in your thinking if you honestly believe that GOOG is going to return 60x from here in 20 years. Your logic appears to be that since GOOG is a great company less than a year from its IPO that it should experience the same growth that another great company (MSFT) did when it was less than a year from its IPO. What you are failing to take into account is how relatively tiny (in market cap terms) MSFT was when it went public compared to how large GOOG was when it went public. You should seriously consider looking for some professional money management help because your logical investing flaws will destroy your returns over the long run. And by the way, I do have a computer science degree, but that has no bearing on my ability, or lack thereof, in understanding GOOG.
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#36
06-07-2005, 03:14 PM
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Re: Google.
[ QUOTE ]
[ QUOTE ] But if it grows at 15% for 19 years... It will return 60x. [/ QUOTE ] ... and if I try real hard, I might be able to excrete a golden egg. 60x growth from here would put GOOG at a $5 trillion market cap. U.S. annual GDP in 2002 (the last year I can find) was around $11 trillion. I think there are some serious flaws in your thinking if you honestly believe that GOOG is going to return 60x from here in 20 years. Your logic appears to be that since GOOG is a great company less than a year from its IPO that it should experience the same growth that another great company (MSFT) did when it was less than a year from its IPO. What you are failing to take into account is how relatively tiny (in market cap terms) MSFT was when it went public compared to how large GOOG was when it went public. You should seriously consider looking for some professional money management help because your logical investing flaws will destroy your returns over the long run. And by the way, I do have a computer science degree, but that has no bearing on my ability, or lack thereof, in understanding GOOG. [/ QUOTE ] 6 billion people and rate of inflation.
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#38
06-07-2005, 09:46 PM
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Re: Google.
I've never traded options... but I think GOOG will be my first one. I will be waiting to get on the PUT side. Of course it's easy for google to go up and up and up because there hasn't been any set backs yet. Just wait till it sets back 10%... everyone is going to start unloading locking in profits.. causing a serious long squeeze. This will combine with all the short money hopping in and selling causing even more of a decline. Everyone keeps saying the $350 number. So what hapopens when it gets there? Only thing I don't like is how expensive a contract is. Kinda tough for me to risk say $2000 on a July $300 put.
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#39
06-08-2005, 01:19 PM
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Re: Google.
[ QUOTE ]
Only thing I don't like is how expensive a contract is. [/ QUOTE ] Well at least you aren't missing any important information! You should seriously be banned from this forum, you could really cause some damage.
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#40
06-08-2005, 01:45 PM
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Re: Google.
[ QUOTE ]
In general, a top PhD Computer Genius... Would never consider working for a MSFT... But would sign up with GOOG in a heartbeat. [/ QUOTE ] While Google is definitely attracting some great technologists, including many from MSFT, your statement is not correct. Top CS people continue to join MSFT for many reasons.
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