Hey everyone it’s ally. hope you’re having a great day. today i want to talk to you about the recent google stock split. google split 20 for one. is it a buy now? let’s figure that out together. was trading for about two thousand dollars a share and now it’s it’s about a hundred dollars a share. so you’re probably like great
It’s cheaper fundamentally changed so then you’re probably splits? well to make investors feel like they can buy more shares and also to make options affordable and more appealing to options traders. so before we take a deep dive into google let’s get some quick housekeeping out of the way. i just want
To remind you that i am not a licensed financial advisor. i am just a mom who’s been newer investors. it frustrates me that investing is not taught in schools. i believe it should be taught as early as middle school if not earlier. at the very least high school but it isn’t, so on this channel we break down the basics in
Layman’s terms with no fancy hard to understand financial lingo. so i would really appreciate if you would help the channel out and hit the like button and um if you wouldn’t mind subscribing to my channel and turning on all notifications this way you’ll get notified the next time that i release a video. okay so
Now that we got the yada yada out of the way let’s get back to google. so on an adjusted basis after the stock split google had a high of 150 and a low of about a hundred dollars currently it’s sitting um about 109 110 so it’s a little bit off the low but let’s figure out together what you should pay for google and what my
Target price is. so the first thing that i like to look at is the five year pe or price to earnings ratio. it’s 35. i prefer to see a lower pe here, closer to 20 but you know i’m willing to pay a premium for google because i know that google has massive potential return on your investment. right now it’s 13.6
Average for google. that’s incredible. that’s awesome. i mean most etf’s are under 10 so that’s great for an individual stock. um the next thing i like to consider is the revenue growth. grew from 123 billion to 270 billion. phenomenal! fourth let’s consider their net income growth over the past five years. it went
From 16.6 billion to 75 billion last year in profit. that is absolutely astronomical. another thing i consider before purchasing a stock is shares and dilution over the past five years. google went from 13.8 billion shares down to 13.2 billion shares so they’re not diluting and they’re buying back shares.
This is another very important thing to look at. lastly let’s take a quick peek at google’s debt. long-term liabilities are only 41 billion and they have 178 billion of cash on hand and their total liabilities are only 103 billion so they literally have enough cash on hand to pay off all of their debts. perfect! okay
So with all of this in mind what is a good price to pay for google? before we figure that out together let me just remind you that there are two different classes of google stock that you can purchase. there is class a common shares which trade under the ticker g-o-o-g-l and there are class c common shares which
Trade under the ticker g-o-o-g. so which should you buy? well for me it’s a no-brainer. if i’m invested in a company i want voting rights. class a or ticker googl have voting rights. class c or ticker goog do not have any voting rights. be things like you know changes to the board, compensation for the board,
Adding more shares to the float or maybe even another stock split a common shares. next let’s consider google’s revenue growth over the next decade. right now they’re growing at over 20 percent. i mean i’m not sure if that’s sustainable but the profit margins will pretty much probably continue. think a high
Price for google looks to be somewhere in the $140 range. a middle of about $100 and under $80 in my opinion, it’s a bargain. cost average in, as close to $100 as i can. if i can get it for $100 i’m just going to keep buying a little here and there and if we see a dip under $100 or closer to say $80 then i’ll
Build out a much larger position for long term. i really appreciate you taking the time out of your day to talk google with me. i think google is a great long-term investment but like decisions don’t forget to do your homework.
Transcribed from video
Google Stock Split 20 for 1 | Is NOW The Time to Buy? | Googl vs Goog Stock By Stock Mom