Incredible Dork...ssshhhhhhh, let the big boys play here. But, I'll pass word along to the powers that be, that you said Google needs to develop an operating system.
FC....I already told you that you have very valid points when it comes to Google. Half of the fun of my posting is because you get so riled up and get your panties in a bunch. You're too easy to get your buttons pushed. If you recall, I too also agreed with you about Google being over valued. I still don't disagree with your assesment of Google being over valued.
HOWEVER.....you are also stubborn and being very shortsigthed when it comes to the nature of stock assesment. You're absolutely correct, top scholars are VERY sought after for hte buy and sell side. The Bloack -Scholes theory is in use at plenty of hedge funds today. So is Graham and Dodd, another very academic model that values earnings streams and shows how to value earnings and apply a $ price toa stock that is equal to the risk free rate to invest. There are many models in usee that are being taught in school. If not, they wouldn't be taught in school, there is a reason they are being used.
Now, you need to be aware, when you are saying I am way too late by the time I get information, you need to realize.....these firms and individuals who are getting information "first", are typically getting a majortify of their information fomr my firm. I not only have access to all the data because I sell the systems that deliver it, but I train analysts and portfolio managers on the buy-side in how to use our systems, how to collect the data and also at times, how to analyze the data. I answer questions and train people on reading earnings, forward and time lagged earnings and esitimates. I also meet with Math PhD's who runthe quant "black box" investing models. These guys create their own proprietary formulas for back testing data, going back 30 years, and use these models to predict stock prices on the universe of stocks. Who do you think they call when they ned this data? That's right, Ur My Bitch.
Oh, 25% return is not unheard of. I am not going to name firm names, but I have clients returning 54%, 85%, 40% and more. The successful Hedge Funds are bringing returns like you wouldn't even believe. My clients manage BILLIONS of dollars. The funny thing is, I have conversations daly with portfolio managers. We discuss sectors and industries, we do Bottom up analysis and discuss what companies are showing strengths and weeknesses. I am on the cutting edge of this information because I am living it daly. I bought some stock yesterday morning because of a stroy that broke at 12:31am the night before. Again, it wasn't on a Yahoo wire serrvice, it was an institutional wire, but again, I know data that makes sense and will impact the price.
I can make plenty of wrong bets. But, guess what, my own personal portfolio has returned 29% since August 2005. 8 months and a 29% return ain't too shabby.
Now, a couple things you said...yes, an 80 P/E is too high. however, Google is trading at a Forward P/E of $46. Tht is more than reasonable. Also, if you look at the revenue growth rate and also the earnings growth rate, the forward EPS that helps make up that $46 F P/E is very realistic. I agree they should diversify, and I think they are taking steps to diversify their revenue stream. Ther is definitely risk as well, but that is why if you are a smart investor, you buy and then you monitor your buy decisions closely. Otherwise you can buy IBM or Coca Cola and just sit and wait 40 years until you retire and your money will still be sitting there, not grown by much, but there.
I shouldn't have pushed your buttons, because had I not, you wouldn't have been blinded by anger, and you would have seen some very valid points iin my posts, and you may have even learned something about stock analysis and reltive value.
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