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Google and Red Hat added to Nasdaq
Rob writes "Google Inc and Red Hat Inc are two of the big technology-related stocks to be added to
the Nasdaq-100 in the latest annual reordering of the 100 largest non-financial stocks on
the Nasdaq stock market. Meanwhile, the addition of Raleigh, North Carolina-based Red Hat
reinforces the credentials of the open source Linux operating system on which the company
has built its business. "
I get more and more flasbacks from the late '90's these days. Let's hope this time people keep their heads together.
-- Cheers!
The subject line really surprised me, as I was sure that those stcoks had been on Nasdaq since they went public. (Pretty much everything is on Nasdaq). I guess I should have known better than to trust a slashdot subject line. The Nasdaq-100 is not the same thing as the Nasdaq.
Sort of reminds me of all the management types here at work who don't know that ISO means anything other than ISO 9000.
The Nasdaq 100 is only updated once a year, in December.
That's my motto buy high, sell low.
Seriously, one would be stupid to buy only for your two reasons. Adding new services does necessarily mean more revenue. Are you aware of how many companies have suffered when they tried to do too much?
Maybe you were trying to be funny
Well, who knows how high it can go? It would've been nice to get in on the IPO.
;)
Remember, GOOG is a very young stock. Those amazing highs are often countered by amazing lows later on.
-The 1920s, the ROARING '20s, were followed by....worldwide depression.
-The 1990s tech bubble, pop!
Also, Google makes most (all?) their money from advertising, not a product sold, which is a tad shaky in itself. What if enough people use Firefox and AdBlock, and block all of their ads?
As for me, I think I'll wait a while before investing in ANY tech company. Heck, something else big and great may come along and Google may go the way of Altavista, for all we know.
A year of solid revenue growth has seen Red Hat's share price rise to $25 from $16 a year ago.
I would guess the stock will rise higher in the next few weeks, not a bad time to buy RHAT stock.
"Red Hat, Inc.: Stock Rating 9 - Red Hat, Inc., a mid-cap growth company in the technology sector, is expected to significantly outperform the market over the next six months with average risk."
From: http://moneycentral.msn.com/investor/srs/srsmain.
More info here:
http://finance.yahoo.com/q?s=RHAT
He who knows best knows how little he knows. - Thomas Jefferson
In other news, Windows Vista will be buggy, no one will upgrade Office and Sony is overrated because they're evil. So why aren't we all rich?
Well, I wouldn't say "everything" is on the NASDAQ. NASDAQ is one of the major stock exchanges in the US; the biggest and oldest one is the New York Stock Exchange. A particular stock is usually traded only on one exchange. NASDAQ is heavy on tech stocks, and NYSE is heavy on older, more blue-chip kinds of companies. Most of the companies that affect Slashdot are listed on the NASDAQ, but for most of history it's the NYSE that's been considered the more important index.
The NASDAQ 100 is an index; that is, it's a number designed to tell you how the NASDAQ as a whole is doing. The most famous index is the Dow Jones Industrial Average; when people say "the market is up" they usually mean the Dow.
The Dow is designed to track big old industrial companies like steel, sugar, and railroads. They're "blue chips", meaning they turn in reliable, consistent profits, and are thus supposed to be a good measure of the overall long-term health of the economy. It's heavy on NYSE companies, though NASDAQ companies are gradually creeping their way onto it.
Fallout from their spat with Cogent perhaps?
GetOuttaMySpace - The Anti-Social Network
Google has been an innovative and interesting company, and Red Hat probably has the best name recognition for Linux in the business. These steps make sense.
The big question with Google is if these laurels that people keep heaping on them will last when Google inevitably loses stock value, for whatever reason. Hopefully, being added to an index like this indicates that some smart people feel that they are here to stay. However, I think most financial people slept through their classes on "Long Term Investment" in business school (if indeed business schools actually offer classes like that anymore).
Google's success = Innovation and they will need to keep innovating if they want to remain relevant. There is always going to be a Microsoft or other competitor who can figure out a way to clone Google's offerings with "just enough" functionality, the right price point, and some evil marketing ploys to create instant competition.
To remain in this game with a high level of quality means new ideas and the willingness to go to places no one thinks can be reached. That will become harder as some of the money pumped into them starts acting like cholesterol: slowing them down and cutting off blood flow to people's brains. Ph.D's may be good at what they do, but they aren't immune to corrosive influences of cash and the lures of prestige. There is going to come a point where Google starts to face the potential for crippling hubris, and at that point, the company will reach it's first real test as a long-term investment. If it can get over its own reputation and keep going, then you have a company worth owning. If not, then they go the way of the 90's, sooner or later.
$400 a share is madness. When are they going to split this stock?
well, berkshire hathaway never split, and they seem to be doing fine.
... hi bingo
You don't just add companies to the NASDAQ 100. You also have to drop them. The losers this time:
Career Education Corp.
Dollar Tree Stores Inc.
Intersil Corp.
Invitrogen Corp
Level 3 Communications Inc.
Millennium Pharmaceuticals Inc.
Molex Inc.
Novellus Systems Inc.
QLogic Corp.
Sanmina-SCI Corp.
Synopsys Inc.
Smurfit-Stone Container Corp.
I've never heard of most of these companies. And that's one of the problems with the NASDAQ 100 as an index. Its contents change often, to drop losers and reward winners. Which means that the NASDAQ 100 is constantly rising as long as they can find some stocks going up.
How can you compare today's NASDAQ 100 index with yesterday's if the stock on it change? They weight the numbers to ensure that yesterday's number is the same as today's, but it means that tomorrow's number is on a completely different scale. The NASDAQ will almost certainly go up because you've replaced losers with winners, but that makes it hard to use yesterday's numbers with tomorrow's numbers to help visualize the overall trend.
The NASDAQ 100 index is far flakier than the relatively stable Dow Jones Industrial Average, which is why the NASDAQ 100 is less often reported than the Dow. It's supposed to measure the health of the hot tech stocks in the US, which means it's going to be flaky, but it also makes the number somewhat less useful.
I guess I should call Granma now and ask how much money she's made off of Google stock.
$400 a share is madness
I can only imagine what you would have to say to Warren Buffet, then -- with BRK.A at almost $90,000/share.
Berkshire-Hathaway
Reinforce the credentials of open source software?
Hmm. So if they are removed from the index does this destroy or undermine the credentials of open source software? I think none of these statements are correct.
People say Google can't be overvalued because it's making so much profit, unlike all the dot.coms back in the day.
But people forget that there were plenty of tech companies that WERE making craploads of profits back then, like Sun and Cisco and various telecom manufacturers. Just because they had profits didnt mean they weren't overvalued stocks. Cisco and Sun fell 90% anyway, because they were in a speculative bubble.
Who would have imagined that Don Lapre's late night infomercials telling you the secret to instant wealth was actually true? (placing tiny classified ads in hundreds of newspapers and taking a small profit on each one) Google and Overture apparently took that informercial in mind while developing their business plans. Except isntead of newspapers, they use websites.
Who woulda thunk it?
Well, TFA is news.
Get used to rejected stories. There is even a whole section in the FAQ devoted to people who wonder why stories get rejected.
I'll tell you this, though -- not many of the stories that are accepted are submitted by slashdotters with high user ID#s.
I'm sure part of that has to do with the number of submissions -- I'd imagine that newer slashdotters tend to submit fewer articles (especially after being rejected a half dozen times). Part of it also probably has to do with paid product placements (though I haven't seen proof of this).
But I'd speculate that a lot of submissions are dismissed out of hand. Who knows why?
At any rate, it's not worth getting upset about. Most slashdotters who've been around awhile are quite familiar with the phenomenon, though plenty of people will slag off the editors when given a reason (however small that reason may be).
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
Linux IT Consulting and Domino Development in Michigan
> well, berkshire hathaway never split, and they seem to be doing fine.
If I was holding their stock I'd keep an eye on Buffet - it's going to crash when he goes...
Thanks.
Why will it crash when he goes? Are all of the underlying companies/stocks going to become valueless at his death?
If it does I'll just use the opportunity to buy more shares.
Unless the stock certificates are open source (read: free), I'm not buying. HYPOCRITES!
Web 2.0 == Giant Blogspam Circle Jerk
$400 a share keeps a lot of uninformed lower budget casual traders out of the stock and therefore reduces its volatility. Seems like a good idea that they don't split it. Plus, look at all the tech companies that split multiple times during the boom and eventually had their stock go down down down. Best for google to wait another year or 2 and see where the stock levels out too before deciding whether to split.
Yeah, my brother said the same thing and I'm not quite sure why. I mean, Berkshire Hathaway is a whole investment company, and I'd bet dollars to donuts that Buffet's not doing all the analysis of his value-investing method, but has teams of quants and analysts doing nearly all of the hard work. So they probably have a good idea of his investment strategies all these years and I don't see why they wouldn't be able to continue with his methods.
make world, not war
> Why will it crash when he goes? Are all of the underlying companies/stocks going to become
> valueless at his death?
I doubt it. But it's likely that many of the people investing in the company are doing so because of his amazing track record. Who's going to take over when he goes, and what's their track record? Will it be significantly better than his? Once some people pull out, the price will drop, and as the price drops hits other people's `pain threshold` it'll trigger more sells.
There are a lot of reasons stocks sometimes go down after a split, and it has nothing to do with a board deciding to split just because the price is high.
One, there is sometimes a run-up in price when split rumors circulate.
Two, splits often occur concurrently with dividend payouts; stock prices drop after dividend payouts frequently.
But it's not true that traditionally, prices go down after a split. Splits are done to increase volatility of a profitable stock -- people like to hold onto their shares when a company is doing well. It also broadens the investor base, increasing stability in the long run.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
you keep doing that
...
You have no idea how stocks, mutual funds, holding comapanies, and other financial instruments work do you?
According to your logic GE, AT&T and Ford should all have ceased to exist many, many, years ago when their powerful founders died or left the board.
The whole staff is 28 or 29 people including the secretaries and accountants. Their might be a few analysts (probably no quants), but I'd be amazed if there were more than 5. If Munger is still alive or they get on naming an heir apparent (watch the GEICO chief) they wont take as big a hit. Sure See's and McLane and the other subsidiaries aren't going to up and fold if he died but who ends up investing the proceeds once he's gone will have a tremendous impact on future returns.
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
What if enough people use Firefox and AdBlock, and block all of their ads?
Legislation.
I'd laugh if it wasn't already coming down the pipes.
Endless arguments over trivial contradictions in books written by ignorant savages to explain thunder in the dark.
> You have no idea how stocks, mutual funds, holding comapanies, and other
> financial instruments work do you?
Incorrect.
> According to your logic GE, AT&T and Ford should all have ceased to exist many,
> many, years ago when their powerful founders died or left the board.
Why would that be according to my logic?
Did the tech wreck of 2001 teach you nothing? The only thing completely stupid is to assume things don't change.
The managers of Nasdaq want to see 5k again, and so adding GOOG and to a lesser extent RHAT will add to the volatility and maybe even whip people up into a buying frenzy. Engineering the index membership based on a financial agenda is extremely dangerous.
I believe I saw an article on the same topic get posted. Perhaps they rejected it as a dupe?
True... but I did search Google and Slashdot for related topics on Slashdot... I saw nothing. However, I certainly could have missed it.
Your story was a dupe.
my blog
Your story was a dupe.
Not so fast... that was only a half-dupe! But hey I'm OK with it, really.
Okay, thanks for the clarification. One batch of donuts being ordered for Anonymous Coward, please pick up at your local donut store. You are anonymous, therefore so is the donut store. If your local store doesn't have it, then go to the next nearest store. Repeat until you either get your donuts, run out of stores, or grow tired of traveling just for some free donuts.
make world, not war