Google is what Saxo’s Peter Garnry regards as an “amazing” company. He says it’s doing “exactly what all companies should be doing”; it’s investing long term in project such as driver-less cars and artificial intelligence acquisitions in robotics - which Peter thinks is "wonderful".
In addition its Youtube channel is “doing well” and Google's mobile android is getting more and more market share. Overall, all of Google's business segments are growing.
But he does point out there are flaws investors should be aware of. Google’s growth rates are dropping because of all the investments it has made. In order to support the current valuation, it needs to sustain higher margins.
On the other hand, he isn't positive about rival Yahoo! and explains CEO Marissa Meyer still has a long way to go. Yahoo! is showing a decline in market share in the US despite its new partnership with Microsoft.
Peter warns that if there are no improvements in the next two quarters, investors will start to sell Yahoo! shares. For these reasons, he's negative on Yahoo!
Author Peter Garnry, Head of Equity Strategy, Saxo Bank
Topics Equities, Google, How to trade Stocks, Yahoo, Saxo TV, peter garnry, lea jakobiak
Saxo Bank provides an execution-only service. The material on this website does not contain (and should not be construed as containing) investment advice or an investment recommendation, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Saxo Bank accepts no responsibility for any use that may be made of these comments and for any consequences that result.
Please read our full disclaimers:
