Wednesday, July 8, 2009

Google Getting More Interesting

Yesterday was ugly. Period.

Google has participated along with the market in giving back some of the gains from the March - May rally. It (GOOG stock at this level) is starting to get interesting.

On the positive side:
  • the announcement that Google will launch its own operating system by next year
  • the stock is not that expensive. Based on yesterday's close, GOOG trades at 18x next year's earnings
  • they are still dominant in the positive shift of advertising to the web
  • it sounds as though they're having a good quarter

On the negative side:

  • Microsoft's new search engine, Bing, is probably gaining a little share
  • Yahoo isn't getting any worse
  • this brave new world government's antitrust folks have decided to target Google, which could be disastrous at worst or a large annoyance at best

Down is bad for now but I believe that at some level I am going to want to own this stock again.

The fact that Google has more ways to distract Microsoft could possibly be a real negative for the software bully, but then again I never like that stock. I wouldn't bet that any of this will have a material effect on Apple.

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