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Google Faces Wall Street Revolt
Fred Flange wrote to mention a Times of London article, which explains a minor rebellion against GOOG on Wall Street. The company, which has always refused to offer guidance for its stock, is now being peppered with requests to do just that. From the article: "Sergey Brin and Larry Page, Google's founders and biggest shareholders, made plain in their listing prospectus that the company would reject many of the orthodox methods of doing business with Wall Street and instead adopt a mantra to encourage its employees to do good and not 'evil'. Other Wall Street analysts last night were also preparing reports that agreed with RBC, The Times has learnt. 'The time has come for Google to step into line,' one analyst said. 'It is in the interest of all shareholders, including the company's employees and officers, that the share price achieves some stability.'"
Their money was good enough for you to take and use; accountability to their requirements is only appropriate.
Yes, but I don't see the investors complaining. The only ones I see complaining are analysts. Do analysts represent the official corporate line of their investors? How many of these analysts actually hold Google stock?
We all know what to do, but we don't know how to get re-elected once we have done it
What bothers me about this is not that Google refuses to provide more earnings guidance, but that the investor are acting like little whiny bitches. Google told Wall Street this is exactly how they would run their company. I have no sympathy for anybody who bought Google stock expecting the company to act like the most other publicly traded company. If they don't like it they can sell the stock. Does everbody allready forget that Google told people not to expect regular earnings guidance BEFORE they went public? I'm not so sure Page and Brin car if the stock deflates all that much. The stock is over valued to begin with. But I guess in the end you can't fault wall street for trying. If they get Google to change they win. However if they don't, and Google holds strong then they just look like fools to me right now.
You know not of which you speak.
Google's majority shareholders are the founders, effectively they do what they want. The shares they sold have limited voting ability, thus limited ability to direct how the company operates. Investors knew, or should have known, those very important facts before investing.
Wall St. is just very used to getting their way, so when an organization doesn't toe the line they get pissy, as another poster mentioned this is a test of Google's business ethic. Either they'll stick to their guns or fold. IMHO folding will be the first substantive sign that Google as a business is morphing into our next technology monopoly that 15 years from now will be the equilivant of MS now or IBM in the 80s.
l4h