Wednesday, October 22, 2008

A Google Opinion

Let's pretend that I'm a knowledgeable person.

I might think to myself, "What is it with GOOG, then?"

I think very much about GOOG. Quarter before last, wise persons were saying that GOOG had saturated the market for clicks. Henry Blodget was running up and down, screaming, "The GOOG has fallen! And it can't get up!"

What happened then was, the Short Squeeze Heard 'Round the World. The earnings were up. Way up. New reserves of clicks were being found every day. In the time it took me to go to the bathroom, GOOG was up a hunnert. Which sent me back to the bathroom, for I had nothing in the game. In a moment of terror, I had sold everything.

I asked myself, what would Cramer do? So I bought it all back, paying up. Way up. I told people I had missed a $30,000 opportunity. Since then, Yahweh has shorted GOOG all the way down to 300. My squandered $30,000 opportunity quickly became a real $50,000 loss.

This quarter, GOOG was due for a big one. And they got it. But the response was tepid. Probably because nobody was short this time. Perhaps, I thought, Yahweh has relented.

So now I am at peace with GOOG in the middle 300's. Probably, GOOG will always be undervalued.

I mean, traders know about charts and balance sheets, but they don't understand software. They don't understand what Google is trying to do and they don't appreciate how well they have been executing. Plus, most traders accept the principle that the World should not be ruled by two young, goofy-looking guys.

But GOOG will get there. My feeling is that next Quarter GOOG's earnings will defy gravity. A perfect storm of everything, kicking in at the same time - mobile, display, YouTube, and several things we don't know about, yet. Overcoming the long, withdrawing tide.

I want to say one word to you. Just one word.




1 comment:

Larry Blumen said...

Mobile's going to be a little late, I'm afraid. Fred ain't dead yet.