And, of course, there have been others - including myself - that argued that $85 itself was a little high valuation for the stock in August 2004. (See also John Battelle's blog).
On the other hand, Google seems to have created an effective distributed computing technological base that can be monetized in various ways. As a result, it is very conceivable that Google will derive a $20B revenue in 2010 that, for a short term at least, can sustain a valuation of $500B, equivalent to a $1800 stock! Recall that Cisco enjoyed such a valuation for a brief period in 2000. And, Cisco is not a software-only company that can produce outrageous profit margins.
I guess we all will have to wait patiently for the next 5 years to see the truth of these analyses.
In today's article in Fortune, Prof. Aswath Damodaran argues that the appropriate valuation for Google stock is $110.
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