Not to give Google bears ammunition, but I thought I would do some left-handed writing this morning and give the critics some talking points. You can’t truly be a bull on a stock unless you can make a stronger bear case than the bears can.
So, if you really wanted to make the bear case at Google, you would argue/do something like the following:
- Point out in the most recent quarter financial services was almost certainly still the heaviest online ad spender. According to September figures, it accounted for 30% of ad spend, versus 25% for the next largest category.
- Put up the top ten list of financial services ad spenders, which is a rogues’ gallery of troubled companies: Experian, Countrywide, Low Rate Source, HSBC Holdings, E*Trade, Wachovia, Bank of America, and Capital One. Their stocks were off an average of 20% in the last quarter, and ad spending will almost certainly be cut further.
- Sit back in satisfaction and wait for the bulls to come crawling with apologies.
- Buy Google stock at $200.