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Alphabet Announces Fourth Quarter and Fiscal Year 2016 Results

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Re: Alphabet Announces Fourth Quarter and Fiscal Year 2016 Results

#101

Post by maverick_iceman »

nyrulez wrote: post #39
aresant wrote: post #7

Editorializing: Paid clicks on Google properties +43% - "yaaay we're driving more paid search!" Cost-per-click on Google properties -16% - "ouch our advertisers are seeing less value on these add'l clicks!" To me the second part of this is going to be most interesting to watch - if the clicks they are onboarding are lower quality, this is going to be a net negative.

It doesn't work like that. Lower CPC does not mean lower value. It just means Google pushing into new eco-systems where CPCs are different from desktop search (e.g. mobile, YT, new publishers/partners) and it may take some time to reach equilibrium among the various actors depending on the ROI of the medium for the respective actors.

Also new growth will come from developing countries which will have lower CPC than the US.

Re: Alphabet Announces Fourth Quarter and Fiscal Year 2016 Results

#102

Post by afthonos »

pc86 wrote: post #96
afthonos wrote: post #25

Earlier quoted context omitted.

Orthogonal to my peeve. :-) After earnings, there are two questions: 1. How did X do? 2. How did analysts think X would do? Perfect analysts would predict Xs earnings every time, and the stock would be unaffected by announcements. But analysts aren't perfect. That's ok! What's not ok is that the headlines are invariably "X misses expectations". No, the expectations were wrong . I'm not saying a company can't do well…

Analysts aren't saying "I think GOOG will grow by X% because reasons," they're saying that based on all factors, if GOOG is run well and executes well, it will grow by X%. Growing by less, even when "less" is 20% and many billions of dollars, means that the analysts believe there is some inefficiency and GOOG, which is why a stock can drop after a company posts a 20% gain in revenue.

With the caveat below (i.e. maybe it's a term of art that I don't understand), I think that's precisely the misunderstanding I'm talking about.

Say I want to buy stock in a company. To decide which, I look at what analysts have to say about various companies, and pick one that they predict will do well. That's the job of analysts: to give prospective buyers (and sellers) an idea of where a company is heading so we can make buy/sell decisions.

That's very different from grading the "efficiency" of the company. In fact, the analyst's job is to take as many inefficiencies into account as they can. I don't care if this company under pristine circumstances can get 60% profit margins; if the analyst knows the current circumstances can only yield 20%, they had better give me an estimate of performance with 20% in it.

Seen in that light, analysts predicting something different from the company's actual output is clearly an analyst failure. But do notice that this doesn't mean the stock should ignore the error, since buy/sell decisions are made on the basis of analysts' expectations.

Re: Alphabet Announces Fourth Quarter and Fiscal Year 2016 Results

#103

Post by afthonos »

WalterBright wrote: post #56
afthonos wrote: post #47

Earlier quoted context omitted.

I'm not so sure. "Analysts Miss X Results" immediately makes you wonder "why", which is a fair question. "X Misses Expectations" instead makes you think X had a bad quarter. I think forcing people to make the conversion in their head every time is bad headlining. Of course, there's something to be said for it being a "term of art". This may just be my layman's interpretation.

Every field has its own jargon and shorthand notations. This particular headline is phrased in the usual way for such things.

True and fair, yet see pc86's comment and my reply to it for exactly the kind of confusion that can arise. :-)

Re: Alphabet Announces Fourth Quarter and Fiscal Year 2016 Results

#105

Post by neximo64 »

btian wrote: post #99
neximo64 wrote: post #93

Earlier quoted context omitted.

Googles mean or even max is far from 35% over their entire history. I fail to see the relevance of your argument. Perhaps you think Google will eventually in the future pay 35% and everything in the past was just an anomaly? Because it's a laughable thought, or if you're absolutely convinced that is the case you're incredibly naive. You're mixing up mean reversion with extrapolation.

Where did you get the 35% number from? You know Google is a global company, right? Corporate income tax rate in Ireland is 12.5%. Have you seen any global company paying 35% income tax?

Does that mean that its profits would be volume weighted based on where they're earned? Because they still do not match up, 12.5% would be the lower boundary - of which Google was below on many years. What you've come up with is a rationalisation.

There is no way you can spin it, there is clear avoidance & the excuse is a battle on details of the law.

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