Sunday, May 01, 2005

Google

A friend of mine has done some extensive analysis of Google, concluding it to be a, "singular opportunity" and maybe the singular investment opportunity of our era. His name is David Gordon and his web site is worthy of your frequent attention, above and beyond about a half dozen illuminating posts on Google. I personally bought Google before I read David's thoughts on the opportunity it presents, but have since bought a lot more. If you miss the excitement that once was the stock market, picking stocks, trying to see the big picture instead of 5 minute bars, you'll enjoy David's blog.

As for me, April is none too soon gone and a fresh month of trading is upon us. The bullish case has come to a crucial point, at least as Harry Dent see's it and as descibed in my archives. Essentially there's about 300 Dow points of risk here that if taken out calls into question Dent's entire great Bubble Boom hypthesis. Against that risk is a minimum of 6,000 points of upward reward. Not a bad bet, if you are a betting sort, especially with market sentiment near historic lows by some measures.

With April earning season behind us and so many stocks wallowing near there 12 month lows, my expectation (read: hope) is that insider buying perks up in May, along with my "old school" day-trading system which I have noted in my previous blog has picked up a bit in the past week or so.

It's Sunday night here in the inland Northwest, my Mac's new operating system, "Tiger," is installed (brilliant!) on my Powerbook and I for one would be hard pressed to imagine things (read: life) doing anything but turning up in May. Of course, I've been wrong before.

9 comments:

David M Gordon / The Deipnosophist said...

Wow, thank you, Allan! Your comments honor me. It is a privilege to be accorded with such accolades. The only problem is that now I have to live up to them... ;-)

Best wishes,

Anonymous said...

You must not be able to count either of you.

Google costs too much and is far from a certainty over time. You lay down 22k per 100....thats just plain stupid. Your DD is all hindsight....this is the typical VC / insider play....a supply imbalance which will become a supply surplus on a dedicated time line as lockups permit. Its ridiculous to say that its the next best thing.....the opinion is riding the momentum of insder / trade control....but its based on a myth .

David M Gordon / The Deipnosophist said...

Well, "Anonymous",

Time might prove you correct, and me wrong -- that would not be the first time, nor the last!

Meanwhile, as a result of my open market purchases (I am not a VC), I have more than $100/share of profits whereas you have zero. I prefer my position to yours, thank you very much... ;-)

David

Anonymous said...

Congrats David, but your recommending new purchases here. Goog at 87ish was a steal, I agree that it was near a sure thing. Now is not then. to double you need 440 ps. That may or may not happen, its unkind of me to just unload on you guys, I know that, but the truth is GOOG is now no more than a controlled pump and dump. The key metric is always return per unit of stocks. At 220, the return per unit to double is challenging, as you yourself noticed resistance at 231 or so. No this market is so oversold the best perscription is assemble larger unit counts of much lower priced issues and wait.....22k per hundred shares is garbage to todays buyer.Of course if you like the feel of goog here you go right ahead. But it is a waste of capital per unit.
David.....

David M Gordon / The Deipnosophist said...

Interesting comments.

There are many different methods of viewing possible portfolio positions, and you note (well) one: dollar weighted. There are others.

If my sole investing objective, however, were to seek "doubles", then I agree, I could spread around $23,000 into more positions than merely one lot of 100 shares of GOOG. This would diversify the risk and the potential.

Despite that recognition, I will continue on with GOOG blithe to the possible reality you posit; I suspect our time frames and objectives are different. Moreover, I perceive GOOG as more than just a stock. The stock is merely one method available to me to participate in a company that will alter our reality.

Guess I drank the Kool-Aid, eh? ;-)

Allan said...

"No this market is so oversold the best perscription is assemble larger unit counts of much lower priced issues and wait....."

Post some of these opportunities and voila, we have a horse race.

Anonymous said...

Sergei Brin Sells $100m in GOOG stock this week
INSIDER & RULE 144 TRANSACTIONS REPORTED - PAST WEEK

Date Insider Shares Transaction Value*
29-Jun-05 SHAO, CHARLES C.
6,200 Planned Sale $1,122,2001
4-May-05 BRIN, SERGEY
President 119,000 Automatic Sale at $227.25 - $229.76 per share. $27,192,0002
4-May-05 BRIN, SERGEY
President 119,000 Option Exercise at $0 per share. N/A
3-May-05 DRUMMOND, DAVID C.
Secretary 14 Acquisition (Non Open Market) at $0 per share. N/A
3-May-05 BRIN, SERGEY
President 88,233 Automatic Sale at $221.85 - $225.01 per share. $19,714,0002
3-May-05 BRIN, SERGEY
President 59,767 Automatic Sale at $225.25 - $228.02 per share. $13,545,0002
3-May-05 BRIN, SERGEY
President 148,000 Option Exercise at $0 per share. N/A
3-May-05 DOERR, L. JOHN
Director 66,700 Automatic Sale at $225 - $225.37 per share. $15,020,0002
3-May-05 DOERR, L. JOHN
Director 66,700 Option Exercise at $0 per share. N/A
2-May-05 SHRIRAM KAVITARK RAM
Director 742 Acquisition (Non Open Market) at $0 per share. N/A
2-May-05 BRIN, SERGEY
President 133,000 Option Exercise at $0 per share. N/A
2-May-05 BRIN, SERGEY
President 46,422 Automatic Sale at $222.26 - $223.5 per share. $10,347,0002
2-May-05 BRIN, SERGEY
President 86,578 Automatic Sale at $220.75 - $222.25 per share. $19,177,0002

Allan said...

I've never found Insider selling useful in forecasting future stock movement. If anyone has, I'm all ears, or eyes as it may be.

David M Gordon / The Deipnosophist said...

Anonymous,

Is this the information that troubles you...?

It does not me, and for several reasons:
1) Share transactions occur anyway - for every seller there is a buyer; for every buyer there is a seller
2) That I know the sellers' names and where they work matters little, if at all
3) Without investigating, these shares likely are 100% of the public half of a private transaction
4) Insiders are notoriously wrong. It is (too) widely perceived they hold some special insight; they do, but re the company, not its shares. This is a critical distinction: there is a difference between a company and its publicly traded shares
5) Limiting one's investment opportunities to those with zero insider selling is folly. Even if you decide to make that Filter #1 it still is only one filter of several, if not many
6) Investing means buying and selling. Otherwise, why invest?