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When I Google "GOOG" in my stockpicking brain, the result is a list of questions.
1) Why buy a "slowing growth" stock in a market that is punishing slowing growth stocks?
2) How can I trust the analysts (and their estimates) on GOOG? Price targets, according to Yahoo! Finance, range from $590 to $900. Why not $400? Why not $1000?
3) Is GOOG too big? Can GOOG monetize YouTube? The space program?
4) Why buy a stock that, as Dennis Gartman would say, is moving from the upper right to the lower left on the chart?
I can't answer any of those question in a positive way, so I can't bring myself to buy it. Under $400 I might change my mind, not because I think it's a good "value" at that price (I have no idea what price GOOG warrants), but because I think other investors would see it as value and I could go along for the ride. It would be a short term trade only, and I'd only consider it if the Nasdaq were bouncing. In fact, the Nasdaq probably needs GOOG, and vice versa.
So, I'm a bear on Google for now, mostly because I'm a bear on the market in general, outside a few select areas that are not in clear downtrends. I concede that some value investors might be able to catch a bottom in GOOG, but I'm not nearly smart enough to be one of them.
[Disclosure: No position in GOOG. For info on my past GOOG trades, click here.]
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