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Google Businesses The Internet The Almighty Buck

Google Takes Top Spot From Time Warner 477

Posted by CmdrTaco from the still-doesn't-have-three-names dept.
newfoundry writes "BBC News reports that Google hit $80bn on the NYSE yesterday, so is now worth more than Time Warner..."
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Google Takes Top Spot From Time Warner More

Google Takes Top Spot From Time Warner

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  • I think this calls for a googlegasm (Score:5, Funny)

    by strongmace ( 890237 ) on Wednesday June 08, 2005 @12:04PM (#12758604)
    unnnhhh yeah oh baby ^^the googlegasm

    • Re:I think this calls for a googlegasm (Score:5, Insightful)

      by Karzz1 ( 306015 ) on Wednesday June 08, 2005 @12:13PM (#12758729) Homepage
      This is not really all that surprising. Google has developed a loyal following amongst its users by:
      1. Not suing their customers
      2. Providing value (not a bunch of recycled crap)
      3. not being evil.

      I am sure there are many more reasons why Google is a "better" company than Time-Warner, however they escape me right now (disclaimer I am very tired and recovering from strep throat).

      • Re:I think this calls for a googlegasm (Score:5, Insightful)

        by anaesthetica ( 596507 ) on Wednesday June 08, 2005 @12:33PM (#12758968) Homepage Journal
        The most amazing thing about this meteoric rise is what it says about a capitalist society. We hear a lot of moaning on Slashdot and elsewhere about how the Big Corporations are going to be around forever, and buy up every other corporation, and kill innovation. What people consistently fail to realize is that small companies are constantly rising up to destroy the old ones.

        If you look at the list of the top 100 companies from 50 years ago, a majority no longer exist. If you look at the top 100 companies from 100 years ago, maybe, maybe 5 are still around. All the "big" corporations of today are supremely mortal. And their biggest vulnerabilities aren't to their main competitors, but to the small innovative start-ups, like Google.

        Think about it: these two guys did some groundbreaking research, built something useful around it, and tailored the technology to their consumers needs. Now they are the highest valued media corporation, bigger than the goliath consolidated media giant AOLTimeWarner. Suing one's customers, buying Senators to write legislation for you, and being generally evil are not signs of impending oligopoly, but signs that the old dinosaur companies are going down the tubes, and will be devoured by a new wave of small companies.
        • I think you misunderstand. We don't rail against the eternal corporation, they do indeed die. Often times, this is not a good thing though... it usually means they were killed by an even worse corporation. It's like locking 1000 psychopaths in the room with guns and knives, the ones that are left are the *worst* of the bunch.

          All you are saying is that some of the psychopaths are female also, and assuming that they fuck around enough, babies are born. Gee, I wonder how that kid will grow up, eh?

          The incredible thing here, is that with Google, that analogy has failed. Here's a company that at least as of now is *not* a psychopath. Some of us are so cynical wonder if it is one, but hides it well, others figure it's only a matter of time before it becomes one even if it isn't already.

          This isn't a shining example of the success of capitalism, rather, it's an exception to the rule. Capitalism shouldn't be a religion, the invisible hand might have been gentle at one time, but now it rarely ever even gives you a reach-around.

          • Re:I think this calls for a googlegasm (Score:5, Insightful)

            by dustman ( 34626 ) <dleary.ttlc@net> on Wednesday June 08, 2005 @02:09PM (#12760019)
            Something to think about here is Wal-Mart.

            Wal-Mart started out as a single store with a dirt floor (!). It was run extremely well by Walton, and he clawed his way to the top of an industry, beating out many established players.

            While Walton was still around, Wal-Mart still seemed to have a heart. Now, it is hard to find a better example of the "soulless corporation" than Wal-Mart.

            What's going to happen to Google when its "don't be evil" founders cash in their stock or retire?

            • Re:I think this calls for a googlegasm (Score:5, Insightful)

              by maxpup979 ( 240106 ) on Wednesday June 08, 2005 @02:25PM (#12760174)
              This is an excellent example of what happens when the founders of corporations die off--generally leaving their empire to their kids. I have worked for 2 large companies, that were fantastic, wonderful places to work. Until the founders kids took over, and turned them into horrible employers. power with no sense of accomplishment, or responsibility is a bad thing...

              • Re:I think this calls for a googlegasm (Score:4, Interesting)

                by anaesthetica ( 596507 ) on Wednesday June 08, 2005 @02:36PM (#12760311) Homepage Journal
                I agree with this: unearned power, priveledge, and position are quite clearly antithetical to the spirit of free enterprise. This is one reason why I am staunchly against the Republican repeal of the inheritance tax. Stupid, stupid idea.
                • And I'm not. I'd say that for every person who inherits undue control of enormous assets, there are a thousand who inherit their dad's store, their mom's house, or the family farm or business.

                  Personally, this simply levels the playing field so that the average family isn't penalized when someone dies. It has little effect on larger estates, as the wealthy could already play the hide-the-money lawyer game with trusts, funds, and so on...

            • Someone will start a new corporation that will make it irrelevant. If we were discussing this back in the 40's or 50's, we'd all be railing against this Sears & Roebuck monopoly on mail-order catalog and department store industry. Today, Walmart has innovated to the point where Sears had to merge with KMart in order to survive. The same thing will happen to Walmart in a decade or two, and the same thing will happen to Google not long after.

        • Re:I think this calls for a googlegasm (Score:3, Insightful)

          by Anonymous Coward
          Um wrong.

          1. You cannot compare 100 years ago to today. DMCA, invasion of privacy, etc

          2. Corporate culture is a lot more organized now. Again, you cannot compare to what it was 50 or 100 years ago. The idea of lobbying and political donations is now an integrated part of strategy

          3. The government has no balls now. Rockafeller was broken up. AT&T was broken up. Microsoft, proven to be a monopoly, was lightly slapped on its ass (more like a pat really)

          4. IP and lawyer culture. There are companies being

          • Re:I think this calls for a googlegasm (Score:5, Interesting)

            by anaesthetica ( 596507 ) on Wednesday June 08, 2005 @01:54PM (#12759859) Homepage Journal
            You certainly can compare 100 years ago to today. There has been no fundamental revolution in the way business is done or organized--incremental changes to the rules don't comprise some sort of historical discontinuity.

            I think you underestimate the level of power that was once directly wielded by corporations. All you need to do is read a book about the Robber Barron era and you'll see what they got away with. They rather openly bought and sold Senators, rather than the timid influencing with perks and donations that corporations are allowed today. They could (legally) raise private militias and use them against other U.S. citizens if they unionized or agitated.

            Our government rightly broke them up. Microsoft doesn't nearly have the power that the old corporations once had. Not even close.

            The successor corporations have all declined. As they grew weaker they had to enter into mergers, rebrand themselves, get bought, etc. in order to arrest their decline. New companies developing new technologies are continually undermining the foundations of the old companies, and will continue to do so, until private enterprise is outlawed.

          • Re:I think this calls for a googlegasm (Score:4, Informative)

            by TheSync ( 5291 ) on Wednesday June 08, 2005 @03:09PM (#12760646) Journal
            1) 100 years ago: little indoor plumbing, widespread legal racial and religious discrimination

            2) There was plenty of corporate lobbying and donations to government officials 100 years ago. The 1906 Pure Food and Drug Act was mainly the work of food producer Henry Heinz, for example.

            1902 to 1912, often referred to as the muckraking decade, saw the publication of more than a thousand articles providing detailed accounts of the economic and political corruption caused by big business, especially the trusts.

            3) Standard Oil never came close to cornering the market, by the time the antitrust case against it was filed in 1906, it had hundreds of competitors. Standard Oil oversaw a dramatic reduction in oil prices. It was convicted because of a general anti-business animus stoked by socialist intellectuals and journalists such as Henry Demarest Lloyd and Ida Tarbell and urged on by the company's higher-cost and higher-priced rivals. As a result the most efficient industrial organization of the time was crippled, weakening competition and pushing prices up.

            AT&T was broken up into pseudo-monopoly ILECs, wow, thanks.

            I can run Linux or OSX, don't need Microsoft. Who cares?

            4) Western Union vs. Bell Telephone on telephone patents? 1878 Patent disputes between big corporations are old news. Of course, copyright extension is another matter.

            Nothing is really all that new over the last 100 years...now go back 200 years, before the widespread legalization of joint-stock corporations...
      • Yeah, and what's great about the universe are:
        1. Time
        2. Space

        Your #2 and #3 are broad, far-reaching categories that actually contain numerous reasons why Google is a better company. #1 is actually part of that, #3, by the way.

        I would change #2 to be "providing services their customers want."

        There are doubtless many manure companies that consider recycled crap to have lots of value.
      • Results 1 - 10 of about 118,000 for Recycled Crap. (0.16 seconds)
    • No definitions were found for googlegasm.

      Suggestions: - Make sure all words are spelled correctly.
      - Search the Web for documents that contain "
      googlegasm"

      I don't think that's correct. Google doesn't turn up any definitions for it.

  • How much further until they surpass Microsoft? (Score:4, Interesting)

    by CyricZ ( 887944 ) on Wednesday June 08, 2005 @12:04PM (#12758605)
    How much further until they surpass Microsoft?

  • Is Google the New AOL? (Score:5, Funny)

    by geomon ( 78680 ) on Wednesday June 08, 2005 @12:04PM (#12758609) Homepage Journal
    How long until Google buys Time Warner?

  • Google is great! (Score:5, Insightful)

    by rice_burners_suck ( 243660 ) on Wednesday June 08, 2005 @12:06PM (#12758623)
    I am glad that a company that "does no evil" is better off than a company that does nothing but evil. That only goes to demonstrate the power of good.

    Google is truly a remarkable company. Innovation at its best... There's probably not a day in my life that I don't use Google at least ten times. I don't know where I'd be without it. One day, I aspire to work for Google myself... Keep up the good work, guys.

    • Re:Google is great! (Score:5, Funny)

      by ari_j ( 90255 ) on Wednesday June 08, 2005 @12:11PM (#12758703)
      Evil will always triumph over good, because good is dumb.
      • And don't forget how much more FUN evil is!
      • Will Turner: You cheated.
        Jack Sparrow: [shrugs] Pirate.
        • Jack Sparrow: [after Will draws his sword] Put it away, son. It's not worth you getting beat again.
          Will Turner: You didn't beat me. You ignored the rules of engagement. In a fair fight, I'd kill you.
          Jack Sparrow: That's not much incentive for me to fight fair, then, is it?

          I love that movie. :]
    • The google is good, the google is great. We surrender our will, as of this day.

      The google is good, the google is great. We surrender our will, as of this day.

      The google is good, the google is great. We surrender our will, as of this day.
    • Google is truly a remarkable company. Innovation at its best... There's probably not a day in my life that I don't use Google at least ten times. I don't know where I'd be without it. One day, I aspire to work for Google myself... Keep up the good work, guys.

      Don't listen to him. I love Google more. Just ten times a day!? I use Google 100 times a day! In fact, I'm going to legally change my name to Google. Please, please, Google, hire me instead!

      (Somewhere, a professional comedian cries. There is a

    • First of all, Google's stock is overvalued. Second of all, their ubiquitous control of the search engine market is not a good thing. Why?

      Okay, here's how it goes, the majority of searches on the internet are done via google, therefore there is a massive incentive to comply with whatever google comes up with next, for anyone that ever wants their site to be seen. This is called leveraging a strong market position, and could border on a monopoly style abuse.

      And just like MS, there will never be any p

    • All you people who claim to use Google umpteen thousand times a day are liars, as evidenced by the fact that nobody has mentioned that Google appears to be doing a tribute to Frank Lloyd Wright today.

      I've already used Google about half dozen times today and I'm just now having breakfast.
    • Thinking in absolutes like "good" and "evil" indicates an unwillingness to consider every aspect of the subject being considered. Claiming that Google is incapable of wrongdoing or that Time Warner does nothing but evil only identifies you as a mindless zealot. I doubt you are capable of seeing anything but good in Google, no matter what they might do.

  • Nothing better.. (Score:3, Insightful)

    by GarryOwen ( 190545 ) on Wednesday June 08, 2005 @12:06PM (#12758624)
    Nothing better than sane stock evaluations.

  • I was hoping for a diff headline... (Score:5, Informative)

    by Anonymous Coward on Wednesday June 08, 2005 @12:06PM (#12758627)
    Internet search phenomenon Google has overtaken a swathe of venerable rivals to become the world's biggest media company by stock market value.

  • Top Spot? (Score:3, Informative)

    by 0kComputer ( 872064 ) on Wednesday June 08, 2005 @12:06PM (#12758642)
    I wasn't aware that 80bn in market capitol was the "Top Spot".

    Another misleading headline...

  • WTF?!?!?! (Score:2, Redundant)

    by null etc. ( 524767 )
    How come this article wasn't entitled, "World's Biggest Media Company by Stock Market Value"???

  • Comment removed (Score:5, Insightful)

    by account_deleted ( 4530225 ) on Wednesday June 08, 2005 @12:07PM (#12758651)
    Comment removed based on user account deletion

  • Allow me to rephrase (Score:5, Informative)

    by Nom du Keyboard ( 633989 ) on Wednesday June 08, 2005 @12:07PM (#12758654)
    ...so is now worth more than Time Warner

    Allow me to rephrase: Some people think it's worth more than Time Warner.

  • More than TW??!! (Score:5, Interesting)

    by Mad-Mage1 ( 235582 ) <infosecguy.mb@gm[ ].com ['ail' in gap]> on Wednesday June 08, 2005 @12:08PM (#12758666) Homepage
    I mean come on, this is so completely unrealistic that ity smacks of the old days of the Internet Bubble. TW at least has real assets that can be valued, while Google is primarily a IP (intellectual property) company. Yes they do make search devices, yes they do have a Proven (albeit short) track record of innovation, but valuing this company at that figure is totally over-reaching. Their P/E ratio is so over-blown that no serious investor can look at this as anything other than a over-correction based upon the fact that Google is an Internet darling and one of the few that surivived the purge and actually PROFITED.
    • I was thinking that if they're one of the few that survived the dotcom bubble then maybe they really are worth what they seem to be.

    • Comment removed (Score:5, Insightful)

      by account_deleted ( 4530225 ) on Wednesday June 08, 2005 @12:24PM (#12758858)
      Comment removed based on user account deletion

      • Re:More than TW??!! (Score:5, Informative)

        by lommer ( 566164 ) on Wednesday June 08, 2005 @01:03PM (#12759333)
        Um, actually as another posted pointed out - TW's physical assets are $45 billion, while Google's are worth $3 billion. So actually, those DVDs, projectors, recorders, archiving equipment, broadcasting equipment, and everything else that Time Warner has does add up.

    • Wrong (Score:5, Interesting)

      by Prien715 ( 251944 ) <agnosticpope@@@gmail...com> on Wednesday June 08, 2005 @12:26PM (#12758885) Journal
      TW at least has real assets that can be valued, while Google is primarily a IP (intellectual property) company.

      Correct me if I'm wrong, but the vast majority of TW's worth is their film/music catalogue. Which is um...IP.

      Google's major earnings come not from licensing IP, but from advertising revenue, making it not unlike a traditional media outlet (e.g. TV station) as far as revenue model goes.

      I would agree with your earnings assement. Google has shown that they can grow fast while remaining profitable on a sustainable revenue model. Does anyone remember the companies during the .Com era actually making profits? Certain tech companies (IBM, MS, Apple) on the other hand, have managed to justify these high IPO values since their stock rises are now near-legendary on wall street.

      • Re:Wrong (Score:3, Interesting)

        by SoupIsGood Food ( 1179 )
        Google's major earnings come not from licensing IP, but from advertising revenue, making it not unlike a traditional media outlet (e.g. TV station) as far as revenue model goes.

        You tryin' to tell me Google's got better market penetration and distribution than Time Warner, one of the largest cable providers in the US? One of the largest periodical publishing houses in the world?

        Nnnnnnah. Didn't think so, neither.

        By way of comparison, Cosmo.com, the internet courier company, was profitable... before it ha
    • If you use last year's profit to gauge Google's P/E (113) it looks like an overvalued stock. But Google posted an HUGE 1st quarter profit with a target of about $6 per share this year. At the current price of $285, that makes Google's current P/E 47.5 which is less than both Yahoo and Ebay and they're not growing anywhere near as fast as Google. This is what is fueling the recent rally.

  • Guess I'll be buying the stock at 282.64 then! (Score:3, Insightful)

    by Yo Grark ( 465041 ) on Wednesday June 08, 2005 @12:09PM (#12758668)
    No seriously. It's insane. I scoffed at it's opening bid of $116.00 and just proved why I don't play the stocks :/

    How many other geeks actually invested and how much? Any life savingers?

    Yo Grark
    • you know you want to get out of the market when everybody and their brother want to get in :)

      And search engine optimization jerks are doing a pretty good job of making google less useful than it was two years ago.

  • But it seems way overpriced. But for a company that has bitchen products, I'll most certainly be a customer of theirs for a long time to come. I just don't plan on investing any money in their company's stock, that's all.
  • Was worth more than TW. Today the market corrected that.

  • 1999 (Score:5, Funny)

    by mushupork ( 819735 ) on Wednesday June 08, 2005 @12:16PM (#12758760)
    Woohoo! The bubble is back!

  • They should buy Netzero... (Score:2, Funny)

    by Anonymous Coward
    ...so they can maximize synergies right into the ground.

  • Google Should Buy GM or Ford (Score:5, Interesting)

    by Doug Dante ( 22218 ) on Wednesday June 08, 2005 @12:17PM (#12758774)
    Both have Market caps at about $18B. If Google were to make a strategic investment of $5-9B in either or both, they could run the internal IT as well as insert Google things in cars. Employee e-mail, calendar, document management, and search by Google, Google maps and yellow pages in the cars, etc.
  • As a long-time Crime Warner customer (the other options suck even worse), I can assure you that what my girlfriend's cat leaves in the litterbox is more valuable than Time Warner, so being valued more than them isn't hard. ;)

    Of course, if you're talking cost, I'm sure TW would cost more than a few pounds of sand and various other items.
    • I can assure you that what my girlfriend's cat leaves in the litterbox is more valuable than Time Warner

      Value is in the eye of the beholder. For instance, a lot of dogs value your girlfriend's kittybrittle a lot more highly than they do Time/Warner. Which is also one of the many reasons why banks don't extend credit to dogs. That plus their tails always give them way in loan negotiaions.

  • NYSE? (Score:3, Informative)

    by adenied ( 120700 ) on Wednesday June 08, 2005 @12:19PM (#12758804)
    It's worth pointing out that Google is traded on the NASDAQ, not the NYSE. A bit different.

  • If you own stock... (Score:3, Insightful)

    by divisionbyzero ( 300681 ) on Wednesday June 08, 2005 @12:20PM (#12758814)
    now might be a good time to sell it. I don't Google is worth that much, but I'm not a stockbroker so what do I know? When this thing pops its going to drop like a rock. It's better to make a profit now rather than be locked out when the selling frenzy starts.
    • I don't Google is worth that much, but I'm not a stockbroker so what do I know?

      You probably know more than a stockbroker. The broker wants you to buy or sell something, anything - he doesn't care what - so he can collect his commision.

  • Google is evil (Score:5, Funny)

    by 91degrees ( 207121 ) on Wednesday June 08, 2005 @12:21PM (#12758829) Journal
    I was fortunate enough to visit google's main HQ. They gave mea tour of thei server room. Now, on any server, you expect to have a few daemons. Google seem to have taken this literally. They summoned thousands of daemons from hell, and chained them to keyboards to answer people's queries.

    I was a little shocked by this, but I put my surprise aside. I've worked with a lot of tech companies. I can forgive them their idiosynchrasies. But then we went to their CEO's office. To even meet the CEO, you have to sacrifice a goat, and if you actually want a full length meeting, he demands nothing less that a virgin sacrifice. So I sacrificed someone who was there for a job interview. The COE was pleased with this sacrifice, and I got to see him. To my shock, I saw that the CEO was Satan himself!

    So don't believe the Google "Do No Evil" lies.

  • Minamlist humour (Score:4, Insightful)

    by MarkusQ ( 450076 ) on Wednesday June 08, 2005 @12:22PM (#12758841) Journal

    Google hit $80bn on the NYSE yesterday, so is now worth more than Time Warner
    For some reason this reminded me of an old minimalist joke:
    So the guy on his way down sees a woman on her way up, and figures it wouldn't hurt to ask. "Hey lady," he shouts as they pass, "do you know anything about parachutes?"

    "No," she shouts back, "Do you know anything about gas ovens?"

    --MarkusQ

  • I want what they are smoking. (Score:5, Insightful)

    by Shivetya ( 243324 ) on Wednesday June 08, 2005 @12:24PM (#12758860) Homepage Journal
    The P/E is already 111. So they think it can bear getting even higher? This sounds like investment house pump and dump, stuff we saw at the end of the 90s with the Internet boom.

    Google would be foolish NOT to buy out companies using stock. Companies would be foolish to accept that type of buyout though.

    As someone else said, some people think it is worth that much. Once the honeymoon ends we might see realistic values which I suspect are a third of what it is now.
    • I heard this argument about ebay too, back when it's P/E was somewhere around 2000 (yes that's right, 2000). Take a look at ebay's stock graph [yahoo.com] and note that they never really went down. When everyone else was busting, ebay mostly stayed the same. And had you bought ebay at the height of the dotcom boom, and held it til today, you'd be quite happy.

      Now, I'm not saying that google isn't overvalued right now, but if they can sustain their income growth, they still might just be a good buy. Considering I sp

  • I've used google... (Score:3, Insightful)

    by exp(pi*sqrt(163)) ( 613870 ) on Wednesday June 08, 2005 @12:36PM (#12759008) Journal
    ...50 times a day for many years. I've clicked on an ad maybe a dozen times in my life. I don't think any of those led to a sale. I wonder how long it will be before the advertisers notice this.

  • ma nah ma nah (Score:5, Funny)

    by djdavetrouble ( 442175 ) on Wednesday June 08, 2005 @12:37PM (#12759024) Homepage
    since this will be a pointless discussion, for your viewing pleasure:

    manahmanah [nyud.net]

  • Obligatory... (Score:3, Funny)

    by Wampus Aurelius ( 627669 ) on Wednesday June 08, 2005 @12:41PM (#12759077)
    ...I, for one, welcome our new Google overlords. They are certainly preferable to our old Yahoo and MSN overlords.

  • What is this, superlative day or something? (Score:5, Funny)

    by FunWithHeadlines ( 644929 ) on Wednesday June 08, 2005 @12:52PM (#12759191) Homepage
    Two stories ago: "World's Biggest Hacker"

    Last story: "World's Fastest Inkjet Printer"

    This story: Google Takes Top Spot."

    Next story: "World's Most Obvious Dupe."

  • Well if thats true then... (Score:3, Funny)

    by JaF893 ( 745419 ) on Wednesday June 08, 2005 @12:57PM (#12759259) Journal
    ...I'm going to party like it's 1999.

  • Enough said... (Score:3, Insightful)

    by johansalk ( 818687 ) on Wednesday June 08, 2005 @01:13PM (#12759444)
    From TFA: "Google is now worth $80bn (£44bn). This takes it ahead of media leviathan Time Warner, which is valued at $78bn. The valuation comes in spite of the fact that Google's annual sales total just $3.2bn, a fraction of Time Warner's $42bn. "

  • Let's look at the numbers.... (Score:5, Insightful)

    by SurfTheWorld ( 162247 ) on Wednesday June 08, 2005 @01:17PM (#12759471) Homepage Journal
    Google's market capitalization has nothing to do with being "worth" more than AOL Time Warner. The fact that Google has issued more stock and has a higher stock price than AOL Time Warner only means that Google has more publicly held debt. That's all stock is: publicly held debt.

    Like privately held debt, Google must pay interest on the stock they issued. Those are called dividends. Additionally, Google may have to buy back shares at some point. Stock != value. Stock == debt. Earnings == value. Plain and simple.

    From an investment standpoint Google is a tulip bulb. Let's compare the financials of the two companies at a macroscopic level.

    TWX: Price of $17.08 on $0.73 earnings per share, giving a PE of 23.41.

    Google: Price of $282.30 on $2.50 earnings per share, giving a PE of 112.92.

    Simply put, Google stock is 112.92 / 23.41 = 482% more expensive than AOL's stock.

    If you had $100 to invest TODAY, and your investment horizon was 1 year, and you had to choose between AOL and Google, this is how it would work out:

    AOL: $100 at $17.08 / share = 5.85 shares. 5.85 shares * $0.73 earnings per share = $4.27. This is a 4.27% rate of return.

    Google: $100 at $282.30 / share = 0.35 shares. 0.35 shares * $2.50 earnings per share = $0.88. This is a 0.88% rate of return.

    The only way that Google can "even the score" and become a comparable investment would be either for the earnings per share to rise. The price of $282.30 is not sustainable given Google's earnings, and if you think that Google's stock price will continue to reside north of $200 you're smoking crack.

    I'll continue to pick on Google financially and point out that in the state of Maryland, you can open a savings account at Bank of America where the annual interest rate for an account with $2500 is 0.55%. This is better than 0.44% and is insured money.

    I love Google and think they provide wonderful services on the web. But as a financial investment I'd rather place my testicles in a vice and ask someone to squeeze rather than purchase their stock.

    -c

    • Re:Let's look at the numbers.... (Score:4, Insightful)

      by flanman ( 2247 ) on Wednesday June 08, 2005 @01:36PM (#12759656)
      I think you've been misled, stock != debt

      While there are share issuances that act like debt such as preferred shares that have a financial obligation from the company, not all shares have a cash value on them.

      Preferred shares generally have a fixed time to live and are "bought" back by the company at a future date (paying off the principle) with a fixed debt servicing cost (usually a dividend).

      While the common shares of a company may be evaluated with EPS or EBITDA or whatever, the shares could be reduced to 0 value (or infinite value) without a direct consequence to the issuer. (without the implied challenges/opportunities to raising additional capital)

      That's why some stocks, like google's, trade at significant multipliers to their actual earnings (exactly what happened in dot bomb) based on the "expert's" view of where the company's earnings would be in the future.

      This is a dangerous game as we all know.

    • Your math isn't right. Google's projected earnings this year is between $6 and $7, not $2.50.
    • Like privately held debt, Google must pay interest on the stock they issued. Those are called dividends. Additionally, Google may have to buy back shares at some point. Stock != value. Stock == debt. Earnings == value. Plain and simple.

      Actually, a BOND is a debt. A Stock is a share in both the assets - and DEBTS - and potential earnings and losses, capped at a maximum loss of the total value invested (translation - you can only lose what you paid, no more).

      A Stock has (optional) Dividends, which may or

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