Google founders to offload 14 million shares

http://www.abc.net.au/news/newsitems/200411/s1248082.htm

More shares being issued. More $ for Google!

Oh please! Everytime a company founder decides to profit on their shares and hard work they've put into a company for several years, people start saying they're "worried" or "duping people" or that they are "greedy".

Yes, 14 million sounds like a lot but how many shares do they own?

Ahh right. They own about 90 million shares collectively and will still have about 40% voting power vs 44%.

Source: http://www.marketwatch.com/news/yhoo/story.asp?source=blq/yhoo&siteid=yhoo&dist=yhoo&guid=%7B63DABD36%2DA3B3%2D4BD9%2D820C%2D8311CDEF8C B9%7D

Sounds like a great deal to me. Would YOU pass it up? That's about 2.352 billion dollars there over the space of about 18 months.

G-Man

I agree with you. They'd be stupid if they didn't cash some in.

Strategic selling of stock by company founders after a company goes public tells you nothing about the future stock value. Only a complete idiot would hold onto all of their stock in that situation. Having a huge majority of your net worth in any single investment is not smart. They will be able to sell about 2x as many shares in the Spring, and you can bet they will. Thereafter, you can bet they will set up some automatic sell routines that sell x number of shares evey quarter regardless of the price. That is just how you deal with large aounts of insider stock.

I remember when Google was about to go public and many people here thought the expected $115 per share projected IPO price was rediculously high, and that those dumb enough to invest were going to lose their shirts. Oooops, I guess that unfounded negativity was a little out of touch with reality. I think the belief that Google's founders selling off some stock as their regulated holding periods come to an end signals an eminant drop in the stock's value is just as unfounded. Google's stock is currently priced quite fairly based on their projected P/E and that of their competitors. The stock will go up if they continue to improve earnings faster than projected. If earnings grow slower thatn projected, the price will go down. And either way, the founders will sell their stock, bit by bit and build more diversified portfolios.

Certainly this selling of shares is not a negative signal, and the market will not take it as such. It is pretty common for people who own large amounts of public companies undertake diversification programs like this.

One thing that might affect Google is that they are issuing more shares ([http://online.wsj.com/media/info-google-chart.gif); an increased supply of shares might reduce the stock price. Theoretically, it shouldn't--because the market should have already accounted for that--but it might not work out like that. In any case, Google's stock price is tabbed as being very volatile--the implied volatility on Google options is enormous.

they should invest in oil or power cells... (if you are smart, you would invest in power cells) as if the whole world isn't going to survive on power cells in the next 50 years...

Eh? What was my post edited for? The only change I see is that the wsj.com link isn't clickable now. Not sure why that would be edited--it wasn't advertising, as I certainly don't own the Wall Street Journal

Anyway, hard assets would make sense for Google. Mark Cuban got lucky because he sold the Yahoo shares he got when he sold out to them almost at the market peak, and placed his money into the Dallas Mavericks, a much more stable asset.

This new "Keyhole" thing appears to be Google's first attempt to put a blatant product ad on their homepage. Though I'm guessing their conversion rate will be miniscule A lot of people are going to click that and then be like "I have to pay money? Screw this!"

MSN already dominates the I.E. homepages
of America. By now it's subconscious for the average
internet user. MSN = homepage. That's what Google
has to worry about. Their results will always be the best,
but that's irrelevant at this point.

I should remove my investment