Jan 15, 2015|
Stock Talk - Jeff Reeves, InvestorPlace by The Financial Exchange
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
Fortunately now we do have odd Geoff Reeves from market over from investor place rather on the phone with us and Jeff I appreciate you coming on today. Yeah a problem. Jeff I know that you have an article they came out yesterday talking about Google and some of the things that investors might have wrong with the stock right now what. What exactly is the article talking about. Yet so. Google everybody knows it one of the bigger companies it's not there and had a pretty good run a couple years ago I got on top and hard content down pretty sharply. In the last six months or so actually in September down about 50%. So you know there were disappointing third quarter earnings and a lot of people are worried that Google is is the next Microsoft right when he beat tech companies which is waters in the wilderness actor. It's got most of the group behind it but I I think that those fears are overblown there's a lot more reason to invest. Google and I think Wall Street is given a company credit for now. So when you do this company I guess just on a pure valuation basis you know where where does it stand right now. Yeah I mean it was applied that brought people depicts the market it's grossly overbought I'm I'm I'm babbling on and it can't if you look back historically that the market speed broadly I think is in line with where did in the modern era frankly I don't really care about valuation packet in 1911 for the Baltimore opera company or whatever I mean there have been a much different world now but so based against what the market that right now I think fairly valued. On and Google in particular is looking pretty good it. Current price to earnings ratio that's in line with the market sport PE. Sixteen or seventeen or knowledgeable about the and the market at large in the tech heavy NASDAQ-100. Actually has its order multiple more like nineteen or warnings though. Google had not overbought and when you consider the fact that a couple of years ago it was going to be a corny historically the Mexican at a cheap so I don't I don't by the notion that Google was. Just been up on the prospect of profits are going to be aired its overvalued I think it back to trading it in the pretty fair valuation based on what its earnings projections. Now what about when you look at regulatory risk because I know that there is an ongoing I believe it's anti trust suit that's not taking place in Europe right now what exactly is the status over there and is that anything that investors here should be concerned about. Yeah I mean that's the biggest catalog of it's out there you know Europe kind of got really draconian with a lot of you have tech companies after that it would no revelations about a year ago. A lot of Europeans were concerned about property is that the kind of that the dirt bill in Germany that. Don't try to pass that would threaten to break out Google I don't know how bad German legislature there are could good break up Google an American company but. That candidate it is illustrative of what the mindset is right now I think it. You know some of regulators were sharpening their not to overstate it is if Google have to say the prolonged legal battle there. I've got sanctions or or whatever would come anytime soon but it took state the burden of a prolonged legal battle that's pretty costly. However I you know I'm I'm kind of of the Marty York got a lot bigger problems right now that an Internet privacy and that all of the metrics over there just a deflation is this fear that the economy kind of slow down I think. Regulators and politicians are probably gonna focus on something out I'm hopeful that it was just kind of fashionable thing. They're Google was in the crop payers in 24 candidate out there and I trust which is a little bit overblown. I want to do anything like it parliament I think it's going to be very very good from Google's stock investors yet one more certainty in the company come forward. Now when you look at consumers increasingly moving over to mobile obviously Google has the dominant. My share of the marketplace through their android platform. It how is that affecting revenues overall look is obviously as people move more. To a mobile platform how does benefit is it affecting their search business and anyway. Yeah I mean so and other big story that got there is that if people are using apps not the not not the web so people who spent a lot out there to see that as many do. The concerns about Google's search market share in mobile kind of declining as you know apple decides that they ought to move away from Google's search. That contain it you know that the focus has spent on the cost per click metrics I think it's just one dimensional. That there's a lot of attention on the fact that what Patrick what. Advertising get to charge. For each impression of that it has been the climate and while it's true it's it's kind of two part. Not equation you need to make is that yeah if that by now what there's so she's a fifty boxes and that people clicked through to cost between five hours about it and I Google on the continent by. If it's fine article prop. If they if their cost is two dollars and fifty cent. Even if only one at a hundred people by that way. Or or one and people like that way I wrote a book about it that they bubble that it's it's it's it's a function of volume is low cost for Clinton took Patrick I think there's been too much. Attention paid actors Google's search is actually I'll still kind of got a killer on the volume front even if it doesn't have the talent on the actual cost per click metric. I think you know a big picture it as as mobile calls I think that advertisers after the ball a ball. So are those Google but I don't think that that became became when that I think that there's a lot of elaborate they can poll even if the actual. Cost per click goes down because the ads themselves are not affect. Jeff got about a minute left to know another a question people than to have about Google. They tend to sit on a lot of cash they they like to make big acquisitions. Anything on the horizon in that fraught. Yeah I mean I definitely had a Radenovic. A big deal by the Google has made it ought not about a year ago a lot of people thought that was a 3.2 billion dollar boondoggle that's not an early result in much but I would say that. Ya gotta have faith in Google about YouTube in 2006 and eleven probable that means very very shrewd. Now that we have a lot of contact. You know as the Google does have all the effort out there some people think that that are kind of silly good Google fiber is an actual fiberoptic. Internet. Program that they're trying to do it would select cities around America and able but that's not in the record business but. Barclays and a longer term about sir I think that's the most important thing Google has got on board is that eventually. I mean what we're reaching peak peak view right how many more quick to people get a much bigger and Google's brain yeah. I think it's very important for them to evolve beyond that and I think that the action is going to be a lot of drop out of it but it did you. Tolerable Jeff I appreciate you coming on with us today and I thank you for all the insight into Google today. Up but perhaps tolerant that was Jeffries from investor place.