Google shares plunge in after-hours trading...
Jan 31, 2006
Google Inc.'s rapid financial growth decelerated in the fourth quarter as the online search engine leader's profit fell below analyst expectations for the first time since its August 2004 initial public offering.
Tuesday's disappointing financial report rattled previously bullish investors, causing Google's stock price to plunge by more than 12 percent in a backlash that wiped out $16 billion in shareholder wealth. [...]
Google released its results after the stock market closed Tuesday. Company shares plummeted $53.65 -- 12.4 percent -- in after-hours trading after gaining $5.84 to close at $432.66 Tuesday on the Nasdaq Stock Market. The shares had fallen by as much as 19 percent earlier.
The letdown might herald the end of investors' love affair with Google's stock, said Standard & Poor's analyst Scott Kessler. "If you ask a lot of people on Main Street why they own Google, they will tell you, `Because it goes up every day,'" Kessler said. "Well, that's a great thesis until it goes down."
Yikes! Is this just a one-time thing, or is the bubble getting ready to burst? Nathan Weinberg from "Inside Google" isn't very optimistic.
In twenty days, Google has fallen over a hundred dollars, sliding from the record high of $475.11 on January 11 to the current $371. GOOG bottomed out as low as $394.74 on the 20th, losing $44 on that day, but it seemed to be in recovery mode ever since, inching higher since, reaching as high as $454, but now I’d wonder if it’ll recover at all. I wouldn’t be surprised if we don’t see a new record high until after the next earnings report.
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