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Google (GOOG) Solid; Posts First Sequential Decline In Sales

 April 16, 2009 07:25 PM

As I often write, I am fascinated by the obsession with technology stocks over the years; most are glorified industrial companies with cyclical growth once they go through their hyper growth younger days. For example, right now everyone is rushing into semiconductor stocks because that's the "playbook" when a recession is ending. Yawn. But I guess electronic thinga-magigs are cooler than industrial widgets. While there are some solid growth companies in tech, and a few that will dominate more and more of our lives as we increasingly go electronic, it is sort of sad to see that even Google (GOOG) has reached the point where cutting jobs is the way to make "the number"... and for the first time in history it had a sequential drop in sales. Ah, even the Googler is not immune to the business cycle. That said, these are the type of number 98% of companies would dream of in this environment - especially considering at heart this is an advertising company in a world where ad rates are suffering considerably.

Before I post some quick hit analysis a very interesting chart set up (the stock is about flat in after hours after an initial burst upward on the typical knee jerk reaction to nothing more than a headline "beat"). The stock actually had two very bullish changes - first, a double top @ $380 was breached today; and this also was a recapture of the 200 day moving average. Two concurrent flags in the ground for the bull army.

But in this extremely overheated market we'll see if Google can hold onto this set up; I don't think charts are meaning much the past few weeks as people race into stocks to gain exposure... combined with the shorts jumping off cliffs to save themselves from the bull.

Some views of the results - via TheStreet.com
  • Google (GOOG Quote) blew past analysts' profit estimates with a strong first-quarter performance but registered its first sequential quarterly decline in sales. The Internet search shop posted adjusted earnings, excluding one-time items, of $1.6 billion, or $5.10 cents a share. That's up from pro forma earnings of $4.84 in the year-ago quarter and more than the $4.93 profit analysts had expected, according to Yahoo! Finance.

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