Yes, we’re facing tough economic times–a recession even–and, yes, Google’s going to feel the squeeze just like the rest of us. Still, it seems that some Wall Street analysts simply don’t understand what makes Google, Google.
Soleil-Media Metrics analyst Laura Martin cut her rating on Google to "Hold" from "Buy" and slashed her price target to $350 from $580…saying the company’s practice of giving 10 percent of profits to charity and giving employees one day a week to work on pet projects should end amid the current economic climate.
Those are two things that help define Google’s character. They are just some of the reasons why Google is great and we love ‘em. Martin demonstrates exactly why Google was reluctant to become a publicly listed company and why it doesn’t provide any financial estimates–some analysts look at the cold, hard numbers and not the company culture behind them.
Martin’s absurd suggestions don’t end there…
…she highlighted another company practice she believes should end – "the confusing myriad of non-revenue producing Google-products in the marketplace."
If memory serves me correct, Google’s search engine wasn’t a revenue producing product out of the gate. She clearly doesn’t understand that Google innovates, and innovates often. Telling it to stop trying would be akin to telling VCs to stop investing in start-ups and for investors to simply keep their money under their mattress.
On second thoughts, if we all kept our money under the mattress, we wouldn’t have the need for out-of-touch Wall Street analysts–that might be some significant cost savings for Soleil-Media in these tough times.