Back By Popular Demand...The Google Earnings Sweepstakes!

You know the drill.  Please submit your estimates of:

1) Google's Q4 NET REVENUE (excluding affiliate payouts),

2) The price at which Google's stock will open the morning after the earnings announcement, and

3) BONUS: Your logic about both of the above.  The more detail the better.

Please submit your bets to the comments section of this post by the market-close on Wednesday, January 31st.  As usual, the winner will get his/her name (real or alias) in lights in a follow-up post--and will also presumably cash in on an overnight stock trade (although that part is up to you).  Note that the sweepstakes tests your ability to not only project fundamental performance, but to have a good enough handle on the market consensus that you can anticipate how the market will react to it.

For reference, below is the Street's printed revenue consensus, which is almost certainly low-balled.  If Google hits this number, the stock will almost certainly tank. So the questions are, how much does the market think Google will beat this number by, and how much will it really beat it by?  And what will happen to the stock in the morning?

I regret that we can't use EPS for this game, but the random ways that analysts choose to calculate Google's EPS make the number nearly meaningless.  We could use operating margin, but then we'd still be arguing about whether stock-comp should be included (it should), and so on.  And who has time for that...

So submit those revenue bets and let the sweepstakes begin!

Street consensus Google Q4 NET REVENUE estimate (per Yahoo Finance): $2.19 Billion, with a range of $2.05 to $2.31.

Comments

[gray williams]

"second derivative of their growth is negative" do you even understand what you just said? if you did, wtf does that have to do with the price of eggs? so what?

"absurd, ridiculous, bonkers" great, logical rebuttal. thanks a million for the complete absence of value-add.

I'm sure you think you're a bright guy, trying to steamroll with your random, circular quant bullshit - so why don't you enlighten us with some legit counter-analysis as to why a heavy beat is out of the question?

look, this was supposed to be a fun little exercise. your attitude is completely unwarranted and unappreciated - but to pass off meaningless technobabble as rebuttal, justifying your slamming other opinions is beyond the pale.

The global economy is far from slowing down, ad spending is strong, the 4Q for ecommerce looks solid thus far (even yhoo and ebay looked good) online ad spending is growing at a greater than 30% clip - of which GOOG owns 55% or higher share.

So tell us tough guy, why is meaningful "revenue acceleration" out of the realm of feasibility?

[JC]

2.33 B

Stock opens at $520

[BlueMcQ]

It got to sound like the Yahoo finance message board for goog near the end here.....I'm doubting tax trouble will surface again, as it was something outside the radar at the time, but not forgotten. Expectations are high due to some recent re-its, upgrades etc, but I believe that people like Anthony Noto from GS have done their due diligence in the channel checks, and yet remained conservative. I'm guessing an eps reported of $ 3.17, and a open of 538-544. Is anyone tracking the avg here? lets see what the collective intelligence number is.

[Dave]

280B
$630

[Dave]

typo
should be:
2.80B
$630

[LC(Li-Sheng)]

1) 2.297 B
2) $533
3) 2006 Q3 increase 78% from 2005 Q3. If use this ratio to times 2005 Q4 (1.29 B), 1.29*1.78 = 2.297B
open price use recently chart bottom price 494 x 1.08% (assume 8% jump) = $533

[PJC]

From a search marketing company who sees the behind the scenes, Google's products are light-years ahead of Yahoo and MSN both from the advertiser and searcher perspective. Money is streaming in and will continue.
This company is creating in a true society changing paradigm.

$2.55B, $2.62

[JC]

Q4 is likely in the bag, otherwise Google wouldn't have increased its checkout promotion midway through the quarter, if business wasn't trending well. That said, the million dollar question remains whether expectations have exceeded reality.

[Richard L. Brandt]

$2.96 billion revenues
stock opens at $520

Hey, Google's Q3 revenues were $2.69 billion. They are not going to decrease sequentially. Last year's Q4 they went up 22% sequentially. So I'm giving them a 10% sequential increase. That's gotta give a big spike to the stock price.

[mb]

I'm updating my previous estimate:

Revenue ex-TAC - $2,315,890K
Wednesday morning open - $492

Rationale - Stronger than expected revenue, but EPS diluted by shares issued to buy YouTube. Additional funding for Google.org plus M&A expenses take a few cents off EPS. Eric Schmidt and George Reyes try to guide expectations for 2007 down a bit -- capex growth will continue to exceed revenue growth, don't expect much revenue from YouTube or Google Apps in the near future, margins and growth rate should compress, etc. The cautionary talk will hurt the stock in spite of the strong performance.

For what it's worth, here's my financial model. I'll fill in actuals during the call and republish to the same URL.

http://spreadsheets.google.com/pub?key=pfUsmdA_oZDZUTiyz2HMMKA

If anybody wants to critique the model, here's a discussion thread -- hammer away!

http://finance.google.com/group/google.finance.694653/browse_thread/thread/07faf897dc5d9396/b6fb1d2f1090a25b#b6fb1d2f1090a25b

[Richard L. Brandt]

I just realized that you may want to subtract TAC.

That means my revenue estimate should be $2.38 billion.

I'll stick with a $520 opening price.

[vic]

Rev ex tac - 2.336
Open at $524

Logic - I'll tell you one thing. Get ready to buy afterhours at $450 cause we've got a dirty number coming and dirty numbers usually cause huge gyrations. Adding to the dirt in this number is reconciling the tax back up to 30% for the year, YT dilution and Google Foundation payment.

[Scoobydooby]

Revenue $2.45 B

Earnings $3.43 per share

Open at $546.35

This will be a biggy. Henry... I am the man.

[Victor]

Just as I said, they'd beat (i was a bit too optimistic), but expectations have become absurdly high (and this can be seen by the stupid estimates people were posting here)

2.5B what were you fools thinking?

[Anthony Kutovoy]

Looks like Rob Zidar nailed it.

[ro54ck]

m561k

[ro448ck]

m751k work from home - http://www.freewebs.com/home77/work-from-home.html work at home - http://www.freewebs.com/home77/work-at-home.html

[batteries]

toshiba pa3154u-1brs battery

[sohbet]

thanks admin good post

knuddels
sohbet
askalemi

[ugurss]

thanks admin good post
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