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Google, or: Why I’ll Never Be Good at Stock Predictions

This article was written by in Investing. 32 comments.

When Google‘s stock was first offered, people were saying it would go to $200. I didn’t buy. I didn’t think there was any way the stock would get that high.

When it hit $200, they were saying the target price was $300. No way, I thought. It hit $300, and they were talking about $400, and when it hit $400, all the discussion was about $500. I thought it would never happen, but it did. $600 came next, just yesterday, and already I’m hearing $700 is a reasonable target.

Hindsight is 20/20.

Image credit: Yodel Anecdotal

Updated January 16, 2010 and originally published October 9, 2007. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 13 comments… read them below or add one }

avatar klerg

While I was a nay-sayer on Google’s stock, I still believe that will go down someday and go down hard. I have a tech mutual fund that has 4.08% of it’s dough invested in Google and I myself am comfortable own that much of the company’s stock.

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avatar franco

In the case of GOOG. The stock has always been inexpensive in valuation comnpared to their peers. I have been hopping in and out of the stock at various price points for sometime. My final position was bought at $454 since it’s P/E was lower than say Amazon.com, but the forward growth rate was relatively high. So come on $700, I am waiting!!!

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avatar Jeremy

I kick myself when I think about Google stock. I was VERY close to pulling the trigger on the first day of trading, but something kept telling me that it was more hype than anything, and it wouldn’t sustain the high price.

Then a few months go by, a year, and longer… and I wish I would have bought even 10 shares. Oh well, that is the way the cookie crumbles. I’ll have to settle for owning some of it in a few of my mutual funds.

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avatar thomas

oh GOOG, how you mock thee! It’s been an ongoing joke since the IPO with my friend about the growth of this stock. We are both in the search business, and were extremely high on it being successful, however just out of college we didn’t have money. I played with the notion of getting a Credit Card Loan to buy some stock, but never went through. “Glad I didn’t buy when it was $150″ is how we greet each other on days like this.

GOOG is a giant, and it is entirely reasonable that this stock moves even closer to (dare I say) 1k. However, there will be a fall as the numbers just don’t add up. There is a GOOG bubble, it’s just a matter of how long you want to ride and if you know when to get off.

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avatar retro

…there’s only one google, hundreds of dot-bombs.

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avatar James

Hey that’s better than this one guy I know. A good family friend of ours, who is actually a pretty savvy investor and a VERY wealthy individual, thought that the Google IPO was a joke and obscenely overpriced. He shorted the stock and lost (presumably) hundreds of thousands if not more.

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avatar SingleGuyMoney

I almost bought at $400 but I thought it would not go much higher. You are right, hindsight is 20/20.

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avatar FinanceAndFat

Yep, I had the exact opinion. Until it was in the 400s and I started to understand why. I think most people just didn’t get how successful GOOG could be with those silly little text ads, I know I didn’t understand it when I should have.

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avatar hank

Boy howdy – Have you seen “Frequency” with Dennis Quaid? Same thing, a quote in there about Yahoo during his time travel experience… 20/20, it will ALWAYS be 20/20. ;)

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avatar Creative Investor

I guess I’ll my 2 cents in here and agree with what everybody else had said, I definitely had and still have the same sentiment about Google: a phenomenal company that huge growth prospects, but will it keep growing at the same rate? At what point investors will lose confidence in it and it will crash (not necessarily through the fault of its own, just the hype that investors built around it)? I just hope than when it does crash I’ll have the guts to get in at that point.

Even though I’m still afraid to buy it now, I definitely would short it. Betting against the company that promises to “do no evil”? Come on now. :)

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avatar franco

Wow, short GOOG…..???? I need to start a trading 101 class. Obviously, at some point it will go down and everyone will say I told you so after the stock runs from 400 to 700+ before the end of the year. But look at the great trading opportunity you all are missing. To short GOOG the smart way would be through options, which at this point does not support an extended downturn. A little pullback possible soon, then earnings release next week, which should be blown away. $700 here we come. Shorts will get squeezed.

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avatar Lazy Man

It’s never about the flat price of the stock, it’s about price/earnings and market capitalization. Warren Buffet has a company with a high stock number, and it just keeps getting higher :-).

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avatar mbhunter

Shoot, I thought its start at $90 was too high.

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