A yield of 13% in less than a month. This is at least about a 150% per year. This is less than the rate the stock (GOOG) is doing since introduction in 2004, because the stock multiplied by five in less than two years time. Well done!

The earnings per share of the stock are estimated to be around five and a half dollar ($5,5). Against the current stock price of $471 does this mean a price-earnings (P/E) ratio of roughly 85. Normal P/E ratios are between 5 for non-growing stock-earnings and 30 for faster growing earnings. So this ratio of 85 holds a lot of expectation.

Let say that the earnings of 2007 will be around $20, this would mean that if the expectations remain the same this stock would be worth around $2000. That will never show on the boards because the stock will be split beforehand.

And still the question for me is, and I hope for others too, is this reasonable? Are we not following a leader because there is nothing else to follow?

Now we come to the aspect of competition. This search engine… No. A company worth 93.718 million dollar (nasdaq.com) cannot be called a search engine. And to which other company is this giant competing against? If you look up for competitors at the nasdaq-site YHOO is not e

ven showing up. Fundamentally I think they do compete.

What happened in this month that there is another 13% price increase? The search engine will be the default on mobile devices. Then there are a lot of other speculation about possible new developments. But will they support the current (stock) growth?

But let's not stray any longer from the subject. The idea behind this live reporting is not only to follow this mayor stock combat, but rather too look at the side effects. Especially when there are occurring within your company.

So, this will be continued. The expectations are set!

© 2006 Hans Bool

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