Google more than exceeded analysts' expectations last night
reporting Q4 earnings of $8.62 compared to $8.22 the year
prior. Excluding items but including Motorola Home, the
company earned $10.59 per share, up from $9.50 a share in the
Google is treating their Motorola Home unit as a "discontinued
business," but is hinting on something big coming in the
Smartphone world from their Motorola Mobile side.
Speculation is rampant about the "Google X Phone" and rumors
of its capabilities range from being made virtually unbreakable
with a ceramic case, having a bendable screen and even advanced
gesture recognition technology.
I have been talking about the first true premium "Google
phone," where hardware and software are melded together in
perfect harmony in an extremely powerful and sexy form
factor. The new phone could come as early as May.
If this phone is a true game changer (which is a long shot),
Google would not only control the internet, but the Smartphone
world as well (android is the #1 Smartphone operating
system)… It certainly seems to me that the company's
momentum is building, even if digital ad prices have come
An amazing new device might help Google be the first to
effectively capture mobile ad revenue as other competitors like
Facebook are trying so desperately to do.
After the 5% pop this morning, Google's market cap is
close to $245 billion, with a little over 328 million shares
Apple watchers on the other hand are expecting modest growth
in iPhone sales (some more than others with the recent bullish
reports from Verizon & AT&T) as well strong results from
the launch of the new iPad mini, iPad 4 and iMac product lines to
drive earnings in the first quarter.
But others are saying that Apple is losing its magic.
Rumors of a cheap iPhone version are being met with very mixed
opinion and some might say that Apple may be diluting its brand
or trying too hard to keep up by releasing new versions of their
most popular items too quickly and frustrating customers.
Apple price targets have been dropping faster than iPhone
calls on the Sprint network.
Apple's market cap at $474 billion is double that of Google,
but they also have close to a billion shares outstanding, which
means they lose $1 billion in market cap for every dollar the
It was only a year and a half ago when Apple was trading at
$315 per share. If Apple were to have a couple rough
quarters and return to those levels, it would shave close to $200
billion off its market cap and put it at market cap parity with
It's also worth mentioning that at current levels, Google
trades at 18 times forward earnings (Zacks) and Apple trades at
just 10 times; earnings momentum can change both of those of
Realize that this is just a little fun with numbers, but if
Apple doesn't change its trajectory, this theory might not be
that far off.
Apple looks to me like they will beat tonight and shares
should at least stabilize around the $500 level or better.
But I do believe that they have lost their way and will need to
rethink their strategy with so much competition knocking down
I also believe that Google is on the right track, but I don't
know if I see them overtaking Apple's market-cap anytime
Do you think it's possible for Google to top Apple's market
cap? More importantly, do you think Apple has lost
its way or will it stand up like Rocky and see its stock make a
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