The perverse view of Google (GOOG) as a "recession proof" company has already been given lie by the firm’s share price. Last week, the stock got as low as $421, near its 52-week low of $406 and down from its period high of $747.
Wall St. analysts have been stubborn about giving up on the search property’s prospects, audaciously holding revenue growth projections at about 35% and price targets at a media level of $600, according to Thomson/First Call.
The predictions of Google’s revenue growth strength is another indication of what buffoons many analysts can be.
Some researchers are beginning to wise up. Kaufman Bros. analyst Jason Avilio cut his revenue estimate for Google’s current, third quarter to $4.03 billion from $4.7 billion, and his profit estimate to $4.65 a share from $4.73 a share. For 2009, Avilio cut his revenue projections to $19 billion from $19.7 billion, and his profit estimate to $22.17 a share from $23.88 a share.
So far, not many of his peers have followed him, and they are likely to get burned when Google puts out Q3 results. Nothing goes up forever.
Douglas A. McIntyre
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