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| 5/24 |
| 2008/8/26-9/3 [Finance/Investment, Industry/Startup] UID:50970 Activity:moderate |
8/26 I just bought GOOG at 500 last week, WHY IS IT DOWN??? What's
up? I don't see any news that would indicate that it's in
trouble. Argh! -newbie investor
\_ http://www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=324097
Opinion: Why Google has lost its mojo -- and why you should care
Sorry. You should have shorted it.
\_ that article is awful.
\_ if you're going to freak out every time a stock you own goes down,
you shouldn't be investing in the stock market. What's your
time horizon on GOOG? -tom
\_ I'm looking at maybe 5 years? -op
\_ So don't worry about the stock price. Do you think the
company has changed since last week? -tom
\_ No, but it's possible sentiment has. GOOG was driven to
heights by investor sentiment more than by any actual
quantitative analysis. Number of insider buys over
the last year: 0. 399 sells, though.
\_ GOOG was driven to heights by making enormous gobs
of money. They appear to still be making enormous
gobs of money. If you believe they will stop making
money, sell. If you believe they'll continue to grow
and make more money, don't worry about the stock
price. "In the short term, the stock market is a
voting machine, in the long term, it's a weighing
machine. --Buffett". -tom
\_ Interesting that insiders don't see it as a buy,
but as a sell. As for the long term, how did
GOOG do 5 years ago? Oh wait, it wasn't around.
Nice quote from Buffett. I doubt he owns GOOG.
\_ Isn't this what they mean when they say
"X continues to defy analysts expectations"?
\_ Why would insiders buy, when they already have
stock built into their compensation package?
And of course insiders sell; that's what
happens when you use stock or stock options
as part of compensation. Microsoft had 77k
shares purchased, 40 million shares sold by
insiders. That has nothing to do with the
propsects of the company; it just has to do
with whether people's options are above water
or not. -tom
\_ Would you buy if you strongly felt it would
double in a year and the market was
undervaluing it? I'm not saying it's a
predictor necessarily, but 399 sells and 0
buys doesn't fill me with warm fuzzies.
\_ you really have no idea what you're
talking about. -tom
\_ Nice rebuttal. Did you spend all day
coming up with that?
Maybe you should read some of these
papers:
http://tinyurl.com/5ahs5d
One of his conclusions:
"This paper provides evidence that
insiders possess, and trade upon,
knowledge of specific and
economically-significant forthcoming
accounting disclosures as long as
two years prior to the disclosure.
Stock sales by insiders increase
three to nine quarters prior to a
break in a string of consecutive
increases in quarterly earnings.
Insider stock sales are greater for
growth firms, before a longer period
of declining earnings, and when the
earnings decline the break is
greater. Consistent with avoiding an
established legal jeopardy, there is
little abnormal selling in the two
quarters immediately prior to the
break."
Another addressing the <DEAD>dot.com<DEAD> bubble:
"Furthermore, stock corrections
after the bubble burst are strongly
negatively associated with estimated
levels of earnings management and
insider selling during the bubble."
\_ how about this: find a technology
company that uses stock-based
compensation, that has gone up in
stock price over the past year,
that doesn't have a huge amount
of insider selling. -tom
\_ That's the catch. If the stock
went up significantly then why
would they buy? It's already
higher than their built-in price
target. If you only look at
companies whose stock has gone
up of course you will find few
buyers: It's overpriced! Why not
find one which has few sales, or at
least a better ratio than 399:0?
AAPL has had some inside buyers. I
am not sure GOOG has ever had an
insider buy. (Not that I could
find.) Are you implying this guy's
research is garbage? It implies
that insiders trade on knowledge
they have, which anyone with common
sense would think is a sound
conclusion. Compare AAPL to
GOOG. AAPL has some buyers. I
am not sure GOOG has ever had
an inside buy.
conclusion.
\_ In the last 6 months Apple has
zero insider purchases and
> 1 million shares sold by
insiders (14.6% of the total
insider holdings). That's
just what happens when stocks
go up. That doesn't mean the
stock is overpriced; it means
that people are exercising
options and having to sell
to cover taxes, or just taking
profits. If you are getting
stock-based compensation, it's
probably a stupid idea to
buy more stock in your company;
you should be diversifying.
-tom
\_ AAPL has had zero insider buys
and over 1 million shares sold
in the past 6 months (16% of
insider holdings). That's just
what happens when you have
stock-based compensation; people
sell to cover taxes on their
option exercises, or they just
take profits. It is generally
stupid to buy stock in your
company when you already get
paid partly in stock; you
should diversify. -tom
\_ shouldn't you be shorting GOOG at 100 ?
\_ I'm not the short GOOG at 100 guy -op, different guy |
| 5/24 |
|
| www.computerworld.com/action/article.do?command=viewArticleBasic&articleId=324097 Microsoft, and it could affect how you use Google's cloud computing services. Google looks as if it's on top of the world right now, holding an ever-increasing lion's share of the search market. Google's largesse has been legendary -- free food, liberal maternity and parental leave, on-site massages, fitness classes and even oil changes. Google recently doubled the price of its company-run day care, and when employees grumbled, top execs dismissed their concerns, according to the Times. The newspaper reported that Google co-founder Sergey Brin ignored the parents' concerns and complained that he was tired of employees who thought that they were to entitled to benefits such as "bottled water and M&Ms" The article's author, Joe Nocera, concludes, "Google has shown that it thinks about day care the same way every other company does -- as a luxury, not a benefit. Judging by what's transpired, that's what Google is fast becoming: just another company." Another example: Google employees have started deserting the company. plenty of other Googlers have headed for the exits as well. Consider this: Google's stock price has plummeted about 34% from more than $740 per share in November 2007 to about $490 early last week. That's even worse than the overall market: The Nasdaq fell 16% and the Dow 17% in the same period. Once a company's stock price follows the market rather than setting its own course, its innovative days are often behind it. It won't make your searches any less effective, will it? But Google has its eyes on bigger things than search, notably your IT department. More evidence that Google's Mojo is gone When Solyanik left Google, he had this to say about Google services such as Gmail and Google Docs: "There's just too much of it that is regularly broken. It seems like every week 10% of all the features are broken.... And it's a different 10% every week -- the old bugs are getting fixed, the new ones introduced." Worse yet, he warned that Google's engineers care more about the "coolness" of a service than about the service's effectiveness. "The culture at Google values 'coolness' tremendously, and the quality of service not as much," Solyanik said. If Google ever gets a serious foothold in IT, Microsoft is in trouble. If you're thinking of making the jump to Google hosted services, look beyond the magic of the brand name. Instead, take a hard look at the services it's trying to sell you, and evaluate Google the same way you would any other vendor. And the next time you use Gmail, Google Calendar or Google Docs, take a close look at the service's logo. You'll notice the word beta there, even though some of those services have been around for several years; If Google is really ready for IT prime time, shouldn't it move its software out of the beta cycle? While it was once just a convenient way for employees to communicate internally, today e-mail systems like Exchange are tightly integrated with other business applications and are one of the primary methods for communicating with current and prospective customers. Protecting Exchange against costly downtime has become a top priority for more IT departments. So how do you ensure that your Exchange environment is always protected? Reproduction in whole or in part in any form or medium without express written permission of Computerworld Inc. com and the respective logos are trademarks of International Data Group Inc. |
| tinyurl.com/5ahs5d -> www.personal.psu.edu/sjh11/Abstracts/index.shtml Unless otherwise noted, all material is: Copyright 1995-2008 Steven Huddart. |