This week's earnings report will have a hard time living up to the all-time high stock price
Google's stock price is at an all-time high of $927 today, and with its Q2 2013 earnings hitting this week it makes us wonder if the earnings can ever live up to the supposed confidence in the search giant. Following a generally solid -- but far from stellar -- Q1 earnings report back in April, Google's stock dipped notably down to $765 only to shoot back up the next couple of days as things leveled off.
Since those Q1 2013 earnings Google's stock price has continued to rise by over 20-percent to sit where it is today, awaiting upcoming Q2 results this Thursday. Whether it is the old system of "buy on the rumor, sell on the news" or flushing out the amount of true confidence in the upcoming financial results, there's a good chance that we will see another small stock dip repeat.
What we need to keep in mind is that a stock dip on earnings doesn't mean that the company performed poorly or that things are bound to head downhill -- there's much more at play in the stock price than the simple earnings numbers. How earnings match predictions, their long-term implications and overall confidence in future company actions all have a huge impact on the final stock price.
Google will reveal what will likely be another strong quarter on July 18th; don't let a small dip in stock price due to overconfidence in the days leading up to earnings pull you away from any positive results.
Reader comments
Investors show confidence in Google, but can Q2 earnings live up to it?
Never felt like gambling all the hard earnings achieved over time. I wouldn't be able to buy much stock at that price, but I can assume that it will continue to climb and would be nice if I had the cahoonas to invest even now.
May want to invest in Motorola, $30 a share and now that google owns them i'm sure after a few years that stock should go up. Google can use Motorola for their own way to implement innovation to make money off of it instead of just giving it away for free with android and their partners. They can still bring innovation to android but would also have a way to make money off of other innovations with motorola.
May want to invest in Motorola, $30 a share and now that google owns them i'm sure after a few years that stock should go up. Google can use Motorola for their own way to implement innovation to make money off of it instead of just giving it away for free with android and their partners. They can still bring innovation to android but would also have a way to make money off of other innovations with motorola.
Much like all of us, I wish I had the foresight to invest in Google back when they first went public. Instead, I probably wasted my money on video games and booze.
Posted via Android Central Beta App on Manta.
The big thing is that you have short-term traders who buy in, knowing the trends of rising stock prices, followed by a fair sized drop the moment the quarterly report goes out, and then the stock goes back up. This is very typical, and you can actually make a fortune from the stock market by looking at stocks that cycle this way, buying 100 shares at a relative low, selling just before quarterly results, and then buying back in two days later and riding it back up.
Now, no matter the actual NUMBERS, Google will continue to make HUGE amounts of money, and Android will continue to gain market share while Blackberry and even Apple will lose market share. Many old-time iPhone users will NOT like change, so will hate iOS 7, and that will hurt sales of the iPhone 5S.
Typical investing mistakes listed here: Worrying about past performance, and worrying about the actual number of the buy price.
Regarding the first issue, if you think the company has good management and outlook going forward, why not invest? You can't do anything about the past. All you can do is put new money into companies you think will do well going forward.
Regarding the second issue, If you have $10,000 to invest, that you can buy only 10 shares of GOOG but can buy 400 shares of some $25 stock, is irrelevant. What matters is the future prospects of the company. Just because a stock is "cheaper" doesn't mean it has more room to grow.
And yes, I am own shares of GOOG, and bought them only recently. Yes I missed out on the 2 zillion% gain since 2000 or whatever, but I still like where they are going from this point forward. Even with my recent buy, it's doing very well, outpacing the S&P 500 by a good margin.