Google Takes Top Spot From Time Warner

newfoundry writes "BBC News reports that Google hit $80bn on the NYSE yesterday, so is now worth more than Time Warner..."

Comments

I think this calls for a googlegasm

[strongmace]

unnnhhh yeah oh baby ^^the googlegasm

Re:I think this calls for a googlegasm

[Karzz1]

This is not really all that surprising. Google has developed a loyal following amongst its users by:
1. Not suing their customers
2. Providing value (not a bunch of recycled crap)
3. not being evil.

I am sure there are many more reasons why Google is a "better" company than Time-Warner, however they escape me right now (disclaimer I am very tired and recovering from strep throat).

Re:I think this calls for a googlegasm

[anaesthetica]

The most amazing thing about this meteoric rise is what it says about a capitalist society. We hear a lot of moaning on Slashdot and elsewhere about how the Big Corporations are going to be around forever, and buy up every other corporation, and kill innovation. What people consistently fail to realize is that small companies are constantly rising up to destroy the old ones.

If you look at the list of the top 100 companies from 50 years ago, a majority no longer exist. If you look at the top 100 companies from 100 years ago, maybe, maybe 5 are still around. All the "big" corporations of today are supremely mortal. And their biggest vulnerabilities aren't to their main competitors, but to the small innovative start-ups, like Google.

Think about it: these two guys did some groundbreaking research, built something useful around it, and tailored the technology to their consumers needs. Now they are the highest valued media corporation, bigger than the goliath consolidated media giant AOLTimeWarner. Suing one's customers, buying Senators to write legislation for you, and being generally evil are not signs of impending oligopoly, but signs that the old dinosaur companies are going down the tubes, and will be devoured by a new wave of small companies.

Re:I think this calls for a googlegasm

[maxpup979]

This is an excellent example of what happens when the founders of corporations die off--generally leaving their empire to their kids. I have worked for 2 large companies, that were fantastic, wonderful places to work. Until the founders kids took over, and turned them into horrible employers. power with no sense of accomplishment, or responsibility is a bad thing...

Is Google the New AOL?

[geomon]

How long until Google buys Time Warner?

I was hoping for a diff headline...

[Anonymous Coward]

Internet search phenomenon Google has overtaken a swathe of venerable rivals to become the world's biggest media company by stock market value.

More than TW??!!

[Mad-Mage1]

I mean come on, this is so completely unrealistic that ity smacks of the old days of the Internet Bubble. TW at least has real assets that can be valued, while Google is primarily a IP (intellectual property) company. Yes they do make search devices, yes they do have a Proven (albeit short) track record of innovation, but valuing this company at that figure is totally over-reaching. Their P/E ratio is so over-blown that no serious investor can look at this as anything other than a over-correction based upon the fact that Google is an Internet darling and one of the few that surivived the purge and actually PROFITED.

Re:Google is great!

[ari_j]

Evil will always triumph over good, because good is dumb.

Re:Allow me to rephrase

[Democratus]

"Some people think it's worth more than Time Warner."

Isn't that the very definition of worth?

Value only exists as an expression of people's faith.

1999

[mushupork]

Woohoo! The bubble is back!

Re:How much further until they surpass Microsoft?

[toopc]

How much further until they surpass Microsoft?

Microsoft's market cap is about 275 billion, so Google still has a long, long way to go.

Google is evil

[91degrees]

I was fortunate enough to visit google's main HQ. They gave mea tour of thei server room. Now, on any server, you expect to have a few daemons. Google seem to have taken this literally. They summoned thousands of daemons from hell, and chained them to keyboards to answer people's queries.

I was a little shocked by this, but I put my surprise aside. I've worked with a lot of tech companies. I can forgive them their idiosynchrasies. But then we went to their CEO's office. To even meet the CEO, you have to sacrifice a goat, and if you actually want a full length meeting, he demands nothing less that a virgin sacrifice. So I sacrificed someone who was there for a job interview. The COE was pleased with this sacrifice, and I got to see him. To my shock, I saw that the CEO was Satan himself!

So don't believe the Google "Do No Evil" lies.

Re:Google is evil

[kertong]

> he demands nothing less that a virgin sacrifice.

That's ok. Here at google, we have plenty of those running rampant.

Re:Google is great!

[prgrmr]

I noticed you were modded 'Funny' for your comment. Funny? I think not. It's this sort of justification that lets beliefs like this survive.

And it's comments like yours that demonstrate that the sarcasm gene is not evenly distributed.

Re:Allow me to rephrase

[HermanAB]

Yup, some 2300 years ago, Democritus said: A thing is worth whatever someone is prepared to pay for it.

Except that he said in Greek of course...

Economists have been struggling with that concept ever since, but the simplest trader in a bazaar (ancient name for stock market) understands it perfectly.

Re:Minamlist humour

[Anonymous Coward]

Color me stupid, but I don't get it.

Let's look at the numbers....

[SurfTheWorld]

Google's market capitalization has nothing to do with being "worth" more than AOL Time Warner. The fact that Google has issued more stock and has a higher stock price than AOL Time Warner only means that Google has more publicly held debt. That's all stock is: publicly held debt.

Like privately held debt, Google must pay interest on the stock they issued. Those are called dividends. Additionally, Google may have to buy back shares at some point. Stock != value. Stock == debt. Earnings == value. Plain and simple.

From an investment standpoint Google is a tulip bulb. Let's compare the financials of the two companies at a macroscopic level.

TWX: Price of $17.08 on $0.73 earnings per share, giving a PE of 23.41.

Google: Price of $282.30 on $2.50 earnings per share, giving a PE of 112.92.

Simply put, Google stock is 112.92 / 23.41 = 482% more expensive than AOL's stock.

If you had $100 to invest TODAY, and your investment horizon was 1 year, and you had to choose between AOL and Google, this is how it would work out:

AOL: $100 at $17.08 / share = 5.85 shares. 5.85 shares * $0.73 earnings per share = $4.27. This is a 4.27% rate of return.

Google: $100 at $282.30 / share = 0.35 shares. 0.35 shares * $2.50 earnings per share = $0.88. This is a 0.88% rate of return.

The only way that Google can "even the score" and become a comparable investment would be either for the earnings per share to rise. The price of $282.30 is not sustainable given Google's earnings, and if you think that Google's stock price will continue to reside north of $200 you're smoking crack.

I'll continue to pick on Google financially and point out that in the state of Maryland, you can open a savings account at Bank of America where the annual interest rate for an account with $2500 is 0.55%. This is better than 0.44% and is insured money.

I love Google and think they provide wonderful services on the web. But as a financial investment I'd rather place my testicles in a vice and ask someone to squeeze rather than purchase their stock.

-c