As recently as a few months ago, Google seemed to be the perfect company. Any move it did was seen as positive and almost no decisions were even questionned. Larry Page and Sergey Brin kept everything secret and it was unclear how Google could ever fail at anything it attempted. Like all tech stocks, Google suffered during the major stock market decline but it had recovered and analysts were back with projections of 700$ and 750$ stocks within the next 12 months.
It all changed in China….
It’s unclear yet how things will end in China but the major announcement that Google would no longer respect the Chinese governments filtering policies with respects to its search engine seemed to change many things for the powerful search engine:
-The most direct consequence of course is that Google might exit the Chinese market and lose important potential revenue & profits
-The launch of the “Google Phone”, Nexus one has not lived up to the high expectations so far
-Because of the unclear strategy of Nexus one, the future of Android is not as bright for many analysts and many speculate that Google could soon be threatened by a Bing-Apple alliance for wireless devices
-In the past few days, Google has been rumored to have run advertising acquisition Doubleclick to the ground
I’m a buyer more than ever
Personally, I do not see all of these elements as being that critical. The only signifiant event in my opinion has been the annoucement regarding China but even that is far from done as Google continues to negotiate with the Chinese authorities.
I don’t think anyone expected Google to move into the cell phone industry and become a force right away so Nexus One’s progress should not be judged weeks after its release. Just the same, Android should be judged based on its progress, not based on its current market share.
As for the recent critics that discuss Google’s dealing of Doubleclick, I find them laughable personally. Doubleclick had some attractive aspects, mostly surrounding its targetting technology and its ad display business. But the company was already on a slide when it was purchased and far from a leader in the field. So I don’t worry about it too much
So yes, I am still very comfortable with my position on Google but also with my pick for Google as one of the top stock picks in 2010. Is the momentum currently hurting both positions? Absolutely, but I’m far from worried at this point.
What about you? Buying or selling Google at this point?