No matter how long or how deep a severe economic downturn, its residual effects can still be somewhat jarring, such as when a company with annual revenues of more than $182 billion is worth less on the stock market than one with $21.8 billion in annual sales. Over 100 years old, General Electric, long the vanguard of U.S. industrial might, ended today’s trading session with a market capitalization just a shade under $105 billion. That compares with the market cap of Google, which now stands at more than $108 billion. Granted, we’ve seen this movie before, during the last bubble, when Cisco Systems surpassed GE.
This should be corrected shortly, otherwise I will never invest again LOL
This is different than with Cisco because Google isn’t overvalued — GE is undervalued.
Good point Frank, though I am sure a lot of Google shorts would disagree with you :-)
That not what the market is saying, they are clearly saying that GE’s financial service unit exposure is wekening the whole corporation
It’s pretty clear that GE is overvalued. As much we all love Google, it is unsustainable for a company’s market valuation to be such a large percentage of the total advertising market value. The total ad market is around$480 billion. Online is 8% or $36 bil. Search is 50% of that or $18 bil worldwide. It can grow significantly, but at some point there are limits.
Rajiv,
I have been looking for the breakdown of those numbers that you provided in your post. Could you point me in the direction that you found those numbers? I really appreciate it.
Thanks,
MacKay
The article I’m quoting from is: http://www.paidcontent.org/entry/419-zenithoptimedia-amid-growing-pressures-on-total-ad-growth-in-08-online-/
If this blog doesn’t allow links then search for “ad spend market.” It’s the 3rd result.
You can find more detail on the break by percentage here http://www.webguild.org/2009/03/share-of-ad-spending-by-medium-october-2008.php
It’s Yahoo circa 1999 all over again.
oh snap…. what a great reminder of what goes up, comes down etc etc etc
Eh, the market will not take Google. The only thing GOOG has to fear is the Government(s). Well, and Itself.
There *could* be another dot-webz bust coming but it would come from Facebook, MS, maybe Yahoo again, and definitely a lot/MOST of the recent upstarts (excluding Twitter – I believe Google would save Twitter if it ever needed saving. Contrary to Eric Schmidt’s wonderfully crafted sarcasmic statements about “ghetto email”, lols.)
The article I’m quoting from is: http://www.paidcontent.org/entry/419-zenithoptimedia-amid-growing-pressures-on-total-ad-growth-in-08-online-/
If this blog doesn’t allow links then search for “ad spend market.” It’s the 3rd result.
Oops…forgot to say great post! Looking forward to your next one.