Google crests 1000 bucks

Staying with stocks, Google topped 1000 Dollars a share for the first time, and the level stuck. Remember on Friday we covered their results, which beat expectations comfortably and perhaps left people feeling like they had not quite had their fill! 1011,41 Dollars a share is where the stock closed, many internet related and advertising stocks rallied in sympathy with Google, perhaps it is time for a ten for one split. Because then maybe the company can be included in the Dow Jones Industrial Average. But I guess that maybe Larry, Sergey and Eric (the chaps with ultimate control) have a Buffett like approach, and do not want more shares in issue. It sounds simple enough, you do not create any further value by doing a stock split, you do make the stocks more liquid maybe. Personally it does not matter if a company trades at 1 Rand or at 10 Rand or 1000 Rand, what matters is the value that you invest in a specific company, relative to the other companies in your portfolio. If buying one or one hundred thousand shares gets you to that point, then so be it. If you must own Berkshire Hathaway (the A shares trade at 175,400 Dollars a share), then buy the B shares, which trade at 116.97 Dollars a share. You can own a piece of Buffett, but would you want to now? Not sure.


Back to Google (not the Google buns according to Enid Blyton, she had the name in her Magic Faraway tree book around 70 years ago) which clocked that level for the first time in their short history, the point I wanted to make was that the stock price is always expensive, relative to their earnings. I remember when the stock listed (at a lower price than many anticipated) folks balked at the valuation. But the stock has been more than a ten bagger in one fewer years (listed since the second half of 2004), and confounded most expectations. Will the company continue to develop and encourage their employees to be revolutionary, in the technology sense? Or will they become too big and cumbersome, not too dissimilar to Microsoft, and become more "corporate" in nature? I am always of the opinion that quality attracts quality. In other words, if your product and offering is quality, talented people will want to work for you. Michael tells me that the movie "The Internship" is a great advert for that, I will get around to watching it!