Fund manager Fred Kobrick believes too many people are buying Google’s stock simply because they have a warm-fuzzy feeling about the company.
“People with a lot of money in Google aren’t sure, other than that it’s a household word, why they own it,” he said. But that’s not a good reason to own a stock, he says. After all, many other tech leaders who were thought to have an insurmountable market lead eventually fell by the wayside.
Kobrick suggests Google is a risky stock-buy simply because the company has yet to expand its income stream beyond paid search.
“Google’s throwing a lot of mud against the wall to see what sticks. That’s pretty scary,” Kobrick said.