The company has had its share of fumbles since the first of 2006 and its stock has been hammered for them. They missed earnings, had some bad press about slowing revenue growth and let some out-of-date slides find their way into a presentation.
Google stock has been off over 20 percent since January and the Wall Street community is not happy.
Still, this is a stock that went public in August of 2004 at $85 per share and is trading around $410 less than two years later.
The company recently became a member of the S&P 500, a prestigious position for such a young company.
The company recently completed a stock offering that increased its cash position to $10 billion, which is a lot of cash to be sitting on your balance sheet. Analysts are speculating the company is planning acquisitions to bolster its position in the market and to buy small companies with “interesting technology.”
Whatever plans Google has, it has outgrown its “two guys in a garage” phase and is discovering that there are consequences for not acting like it wants to be a big company.
Apple Computer found out the hard way that “doing your own thing” may sound romantic, but it is not always the best business practice.
Google has a commanding position in online advertising, but it is not unassailable. Bigger competitors are challenging its position and advertisers make look to hedge their bets rather than rely primarily on a single online presence.
Google looks like the 800-pound gorilla now, but that doesn’t mean it will always be on top. Taking better care of the investment community by providing more information will go along way towards making everyone feel better about this young company.
