What’s Fresh?

Google’s stock hit $610, yesterday! Are investors getting a little crazy again?!? Now I am one of Google’s biggest fans (even though I do not own any stock), but this price certainly made me question investors’ sensibilities regarding this tech stock (seems like I have heard that comment in the past…). Yes, Google has created one of the greatest cash generating machines of our century with Adwords and Adsense, but can they sustain this growth?

For the past several years, Google has made forays into many new areas outside of search, including Print Ads, Audio Ads, Video, TV Ads, Checkout and YouTube. Not one of these efforts has added significant revenue to their bottom line. How can their stock price possibly be sustainable if all of their efforts to grow beyond search have failed? The acquisition of DoubleClick may help sustain the growth if it happens, but that acquisition looks tenuous at best with all of the reviews from the FCC to Congress.

If the Google stock bubble pops, it will certainly be felt throughout the industry. While there are certainly more online businesses with viable business models than in 2000/01, any Google price crash will be tough on the industry. So, we will all be watching to see if Google’s stock is really too high.

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