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Google Files for IPO
bobwyman manages to be the first to submit this story, apparently by using his own web service: "Well, the PubSub.com SEC Edgar notification system just sent a message a few minutes ago saying that Google has finally filed their S-1 to go public. See: Google's S-1 which was accepted by the SEC at 2004-04-29T13:53:49-04:00. If you had had a PubSub.com SEC Edgar subscription, you would have been one of the first to see this filing."
The Google IPO has been so hyped that I think the shares will be priced so high at the beginning that they will have no place to go but down.
UNIX/Linux Consulting
"If you had had a PubSub.com SEC Edgar subscription, you would have been one of the first to see this filing." - was this advertisement strictly necessary?
This stock is going to fly straight up for the first few months.
Then it's going to tank.
Then everyone will buy it at $1 a share.
It'll repeat this cycle for a while before stabilizing. In the meantime expect Ads to start flooding google.com as they try to meet their new quarter numbers as expected by share holders.
Most people don't know much about investing or even money in general.
More then a few outstanding ideas have died or at least not lived up to their potentials due to bad implementation, planning or management.
Myself I'm not convinced 1 that google is a long term financially sound company.
The IPO price will probaly be too high to justify what value they do have.
And most importantly. There are probaly more established companies with a history of performance that will offer a better return with less risk.
Speaking quite frankly here, if you don't have money you can piss away, don't bother with buying individual stocks.
Also, keep in mind that you have to pay a commission on purchase and on sale. So lets say you buy $500 worth of Google, and it goes up to $600. You pay $10.95/trade (Ameritrade, say). That's $78.10 profit. If you sold it within 18 months of buying it, you have to pay income taxes on that money, lets say that is 25%. That's $58.57 profit. (Actually, I don't remember if you can discount the commissions for tax purposes). That's around a 11% return. If you buy $1000, and it goes up to $1200, gives you $133 profit after the 25% taxes and commissions, a 13% gain. The more you invest, the less significant the commissions become.
If you insist, though, you don't have to spend all of the money in your brokerage account on stock. You can leave some in as cash. You probably won't earn interest on it, but since its only a few hundred dollars anyways, that shouldn't matter too much.
Btw, you may be interested in a service such as Sharebuilder. They can automatically debit a certain amount every month, and then buy fractional shares. It's like $12/month for the service, though.
Yeah, because every company that has gone public has stopped innovative R&D and constant steady growth. Look at some of the major public companies out there (3M and General Electric) to see what R&D can really accomplish. Add in the fact that Google will gain at least $2 billion that they can use towards more services, current research, and increasing infrastructure. Your comment is baseless
What I'm going to say I think is not much new, but here's a good place to say it. You're right, but I think what the original poster really had in mind was not necessarily innovation in terms of doing research. It was more along the lines of innovation in terms of risky undertakings paying off. Once a company goes public, you can't throw the basket of eggs at the wall and see what sticks anymore. You have to choose more dependable undertakings to convince your investors not to sell. While risky undertakings can lead to wildly successful innovations, there are plenty of less risky undertakings which I'm sure Google can handle. Google's future will look more dependable, which is good, because yes, they're a quality company.
I think those preaching "run out and spend all your money to buy Google stock because you'll get rich" need to sit back and think realistically for a few minutes.
The main thing to remember is: the 1990's are over. That was last decade, this is now. Over-inflated stock prices with P/E (Price to Earning) ratios that are ridiculous are mostly gone now. Sure, Google's stock will probably do ridiculously well for the first few months. However, if everyone thinks this, it will just be artificial inflation waiting to fall out as long-term investors realize that the stock price is way higher than it should be for their earnings. No matter how much some of us dislike Microsoft, would it make any sense for Google, whose earnings are only an inkling of Microsofts to have a stock price that soars far beyond Microsofts and through the roof to match the likes of what Intel and Amazon used to trade at (hundreds of dollars per share)?
Those are just a few of my thoughts. I plan on investing in Google but only as a long-term option, because I believe that they will do well in the long run, but that their stock price will be overly affected by "announcements" of new features etc. Their business model is fairly narrow (e-mail, search services / advertisements, price-searching etc...) and does not have many sources of revenue. Who knows, maybe they can get rich off the search boxes they sell to companies to use to search data on company networks?
"To strive, to seek, to find, and not to yield." - Tennyson
After you mortgage your house and before you buy Google shares, put some money on the side for a small tent.
I plan to buy short. Not much, perhaps 1K, just in order to put my money where my mouth is.
Quality of Google search engine results is getting worse, the email thing hasn't really taken off (although bad publicity has) and most of their money in near term is expected to come from these two. They already have a huge market share in Web searches (not much more space to grow), so the Gmail must take off if they're go maintain fast growth in 2004.
There's nothing magical in Google technology and services. True, it's been a revolutionary product/service so far, but its technology is already mature. Due to ever increasing CPU, networking, clustering and storage technologies, in two-three year time, a smart startup will be able to catch up with their search engine size within 2-3 month time. It will take couple of talented guys like the Googlers (there are smart people out there who don't work for Google yet), a better search algorithm (reasonable expectation) and some money for storage and bandwidth (who wouldn't invest couple of millions in a company that wants to beat Gogle).
Anybody can purchase it as soon as it goes public. Of course, the value is going to jump many thousands of percent in the first minute of trading, and if you're trading with a discount broker your odds of getting some before it peaks are very slim. You could put in a market order and get bled dry, or you could put in a limit order at a reasonable price that will never be filled.
The rich are going to get richer on this one, and the rest of us will just have to sit patiently. Because everyone assumes buying Google is a good idea, by the time your typical person has the opportunity to do so, it's not.
IMHO.
On the other hand, the IT industry is filled with companies sending jobs overseas, holding back costly initiatives, and downsizing their R&D departments, because they cost money and impact the bottom line. Further, companies absolutely make decisions on a yearly timescale when they have to report to the public. A 5-year project which will take $100 million off the bottom line each year before yielding dividends? Good luck selling that proposal.
This article makes some HUGE assumptions, the biggest being that search is going to be commoditized. The thing that made google so great is that they were able to differentiate their searches as markedly better and drove customers to their site away from competitors... which allows them to charge more for their ads- considering that they are indeed making a ton of money off of this, I think their customers are quite happy. Really, I would say that half of the entries on the list are related to the fact they think search is easy and anyone can get into the business and excel at it.
The outsourcing item made me wonder how much the writer really understands the difficulty of implementing a search engine. You can outsource typical day to day applications, the easy stuff. Google is doing cutting edge work! This is not a case of putting 1000 monkeys in a room and youll be a leader at search, and if youre still not w/ 1000 monkeys, then just add 1000 more. Or popping out JSP pages.
Google does have a strategy to lock in customers-Gmail. #9, about profit extension is not completely baseless, but they are not extending so much as optimizing their core strength to new applications. If a car engine company makes specialized engines for airplanes or boats, thats not really "extending" to me. If they tried to make cars, then that is a different story.
#6 about pay per click advertising is off base, considering the nature of google's ads. They are non intrusive, and embedded in the dynamically generated html. it would be very difficult for these adds to be removed, and they are so unobtrusive most users are not bothered in the slightest by them.
Overall, I found the article quite lame. Competition is definitely a concern, but if youre buying google, youre really buying the idea that Google can do things better than its competitors- people still buy Ford and GM stock regardless of the competitive nature of the auto business.
I was hoping their proposed Maximum Aggregate Offering Price would be 1 x 10^100.
Ironically, the word ironically is often used incorrectly.
Regardless of how we think Google might change as a result of going public, I think we should at the very least all celebrate the facts that 1) A good tech company can survive, thrive, and even get investor funding in the post dot com bomb world and 2)the creators and employees of Google are finally getting their just rewards. Yeah, they're going to make a boatload of money and that, of itself, is a very cool thing.
Anthony Papillion
Advanced Data Concepts, Inc.
"Quality Custom Software and IT Services"
I used to work for the company that pioneered this process for IPOs. Remember Andover.net? That's how they went public (but don't take that outcome as an omen). It's a great pricing model, and still leaves a bit of a first-day pop for the investors.
The gist of the process is that it prices the IPO so that the proceeds to the company are not diverted to institutional investors. In traditional IPOs the investment banker typically underprices the shares and allocates most of them to large institutional investors as a reward for holding large portfolios in-house. The first-day pop you saw in other IPOs is a sign of that underpricing (in addition to some irrational exuberance). If company X offers 100 shares at $10 per share, then the price shoots up in the aftermarket to $100, that means the company likely could have gone public at $100, raising 10x the revenue. The auction would price it closer to $100.
"You done taken a wrong turn."
-Bill McKinney, in Deliverance
where's the incentive to purchase their stock?
It's the "Greater Fool" investment strategy:
No matter how much I pay for this stock, a greater fool than I will pay even more.
The parent poster makes the most important point that I've seen in this discussion.