The heated rivalry between Google and Apple
Investors flocked to Google and Apple in early ’09 as it became clear that even a severe recession wouldn’t stall them. Last year, Google’s share price doubled; Apple’s shot up 147%. Apple might be more inclined to support its assassment premiums. A long history of successfully leap into new products leads many tech experts to see it as a pricey, but less risky, play. Google, 22 years younger, is always trying to expand beyond its core expertise in the research network.
The heated rivalry between Google and Apple extends to the stock market, where their shares jostle for pride of place in many technology investors’ portfolios. With Bloomberg data shows prices to wages of the two populations over 85% of the 500 companies in the stock index Standard & Poor’s, which may have difficulty meeting the expectations of investors.
Alan Lancz, the asset manager Alan B. Lancz & Associates in Toledo, Ohio, began buying Google and Apple shares in Dec, 2008. He stopped buying when Google, now at 600, passed the limit of 365 he had set for the stock last Apr. Apple, now at 210, passed his limit of 130 last May. Lancz raised his six month price estimates in Nov, to a range of 620 to 680 for Google and 215 to 235 for Apple. “We like the companies but definitely wouldn’t be buying them now,” he says.
Google may prove more vulnerable to a weaker than expected recovery. In 2009, there has been a growth in profits by reducing costs, but sales growth over the past 12 months has fallen to 8.4% from 31.4% a year ago. (Apple Turnover grew at a rate of 12.5% over last year, about half the growth rate a year ago.)“So much of Google’s business model is based on advertising,” says Michael Shinnick, a portfolio manager at Wasatch Advisors in South Bend, Ind. Web competition is pushing advertisement rates lower at the same time that the economic downturn has forced advertisers to cut their budgets. “It is going to be tougher for Google to put up the type of revenue they have had in recent years,” Shinnick said. The average analyst prediction for sales growth of Google is 16%, according to data compiled by Bloomberg, and 23% for Apple.





