Nervous Google investors got a big reassurance as Google (goog) reported 1st quarter earnings per share today 4-17-08 of $4.84 per share. The analysts were looking for $4.52 per share. Gross revenue rose 42 percent to $5.19 billion, analysts were looking for $5.13 billion.
With the ridiculous news coming out of comscore a few weeks back, the stock was punished for inaccurate comscore's paid click data. If you were paying attention you would know that Google had already told us that they were reducing bad clicks, and that there click data could suffer, but that it would generate higher revenue per paid click. Obviously, they were correct and comscore now has zero credibility! Here is a couple highlights from the quarter...
• Revenue growth of 42% Y/Y and 7% Q/Q
– Google properties revenue growth of 49% Y/Y and 9% Q/Q
– Network revenues increased 25% Y/Y and 3% Q/Q
– Growth in international markets continued to be strong, with $2.7 billion in Q1 international revenue
• Operational Highlights
– Improvements in search quality remain key focus
– Continued ads quality initiatives to show users better, more relevant ads
– Increasing value for advertisers and publishers with broader and deeper solutions
• Acquisition of DoubleClick gives Google the leading display ad platform
– Strong Apps traction and addition of functionality to Google Apps suite of products
Take a look a these slides from their earnings report and let me know if you notice a pattern...
Google's US Vs. International Revenue Growth
In summary, I have been behind Google since very near the beginning and their growth has still only just begun the way I see it. If you have been waiting on the sidelines to jump in now is the time. Google's stock has been beaten down with the rest of the market unfairly, and they have silenced all the critics with this beat. The shorts are running to cover as Google is up over $80 in after hours!
Internet advertising and mobile advertising are the waves of the future because of their unique ability to target. This makes a for great return on investment for advertisers which is exactly what they are all looking for. The advertising market is estimated at 1 trillion dollars and Google is only going to capture more of that quarter after quarter, year after year. One of the best long term investments out there.
Think about this, many analysts had lowered their first-quarter estimates by 12 cents a share on average. So, 1st quarter 2008 earnings still beat by those lofty analyst's targets by 0.20 cents! Those same analysts that have price targets as high as $900... Google still beat them. This story is far from over...
For more reasons to own Google check out these posts...
Yahoo Tests Outsourcing Search To Google
The Google Checkout Effect
Google Misses By A Penny, Does It Matter In The Long Term?Stock Outlook 2008
The Real Winner Of Cyber Monday Is...
Or you can view all of them on one page here!
Looks good for me and my 3 shares! Too bad I can't afford any more!
ReplyDeleteGood post, online advertising is the way of the future. If your business is not online now or in the near future you will be falling behind your competitors. Wish I had the money to buy a few shares.
ReplyDeleteI have hammered this point down a few times, but I think it needs to be said again. A lot of people simply think it is not possible to buy Google because it is trading at $500 a share. Well, that is just not true, many services out that allow you to by partial shares including sharebuilder.
ReplyDeleteIf you only have a little bit of money to invest you can buy a half or even a quarter of a share or even less.
Don't get confused you don't have to buy a full share... look at Bershire Hathaway... they are at $100,000 per share, do you think anyone goes out and buys a full share of them?
I hope this helps and once again congrads to all the longs : )