Author Topic: GOOGL - Google  (Read 422394 times)

stahleyp

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Re: GOOGL - Google
« Reply #1870 on: March 24, 2018, 10:17:12 AM »
This might be a silly question, but when one has an ad blocker, does google count that when paying out to video creators on youtube? I read that these folks get $4,000 per 1 million views. I'd have to imagine a lot of people block the ads.
Paul


mbreject

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Re: GOOGL - Google
« Reply #1871 on: March 26, 2018, 10:36:39 AM »
I *think* they pay per impressions, so a view with an ad blocker wouldn't count.

siddharth18

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Re: GOOGL - Google
« Reply #1872 on: March 26, 2018, 11:21:14 AM »
This might be a silly question, but when one has an ad blocker, does google count that when paying out to video creators on youtube? I read that these folks get $4,000 per 1 million views. I'd have to imagine a lot of people block the ads.

Not at all. Digital ads on Google are priced either by click or by view (impression).

Google goes to great lengths to avoid charging the advertiser "invalid" clicks and impressions - typically clicks/impressions that are suspicious in nature. This would include clicks/impressions that are performed by bots, blacklisted IP addresses, malware, etc.

So there's no way advertiser would be charged for an obviously blocked ad.

Even if Google did charge for an invalid click or a blocked ad, the overall ad performance would drop which would lower advertisers' ROI on ad spend which would then pressure the ad prices downward. But knowing Google, there's no way in hell they would let that happen.

stahleyp

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Re: GOOGL - Google
« Reply #1873 on: March 27, 2018, 12:06:09 PM »
thanks guys that makes sense.

So is there a third party that verifies these or is all done with trust by google?

It's just so easy to get an adblocker and not get stuck watching these ads. I'm surprised google doesn't somehow block videos for those using adblockers (a lot of places are doing that nowadays) or not many people use adblockers to warrant the work to block videos (or, if google is the auditor...then there is a conflict of interest there).
Paul

Contra123

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Re: GOOGL - Google
« Reply #1874 on: April 23, 2018, 03:42:28 PM »
I thought I'd post this here:
https://ftalphaville.ft.com/2018/04/23/1524506401000/Is-Google-cheap-/

The above is a good read, IMO.  The authors are upfront and open about their assumptions and thought process that walks you from the current EV, market cap and GAAP EPS to their 'adjusted' P/E of 16.5x.  Quite often, you meet people IRL and online who will off-handedly quip that GOOG trades at a 'market' or 'below-market' (I assume they mean the S&P500 is the market) multiple of earnings or free cash flow, but don't really explain how they get to that.  That did not always sit well with me because if you take GAAP net income or if you follow the classic calculation of levered or unlevered free cash flow (e.g. treating stock-based comp as a real cash expense), I always got P/E or EV/uFCF multiples north of 30x, which isn't quite 'market' or 'below-market'.  I think GOOG is a fine business and the long-term result from a buy-and-hold approach to GOOG stock is likely to be satisfactory, but IMO saying the stock trades at a below market multiple is incorrect if one does not have the appetite to go into the level of granular discussion that the Alphaville article is engaging in, especially making some specific assumptions that GCP and Youtube are separable (in a SOTP sense) from the core business, and then valuing those components using some specific EV/Rev multiples.
Disclaimer: Regular guy. My takes are reliably bad & I am the ultimate contrarian indicator.

Liberty

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Re: GOOGL - Google
« Reply #1875 on: April 23, 2018, 04:49:36 PM »
"Most haystacks don't even have a needle." |  I'm on Twitter  | Interesting podcast (new link)

wolverine890

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Re: GOOGL - Google
« Reply #1876 on: April 24, 2018, 07:43:18 AM »

flesh

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Re: GOOGL - Google
« Reply #1877 on: April 24, 2018, 10:03:01 AM »
I thought I'd post this here:
https://ftalphaville.ft.com/2018/04/23/1524506401000/Is-Google-cheap-/

The above is a good read, IMO.  The authors are upfront and open about their assumptions and thought process that walks you from the current EV, market cap and GAAP EPS to their 'adjusted' P/E of 16.5x.  Quite often, you meet people IRL and online who will off-handedly quip that GOOG trades at a 'market' or 'below-market' (I assume they mean the S&P500 is the market) multiple of earnings or free cash flow, but don't really explain how they get to that.  That did not always sit well with me because if you take GAAP net income or if you follow the classic calculation of levered or unlevered free cash flow (e.g. treating stock-based comp as a real cash expense), I always got P/E or EV/uFCF multiples north of 30x, which isn't quite 'market' or 'below-market'.  I think GOOG is a fine business and the long-term result from a buy-and-hold approach to GOOG stock is likely to be satisfactory, but IMO saying the stock trades at a below market multiple is incorrect if one does not have the appetite to go into the level of granular discussion that the Alphaville article is engaging in, especially making some specific assumptions that GCP and Youtube are separable (in a SOTP sense) from the core business, and then valuing those components using some specific EV/Rev multiples.

I'd be interested to see how you get to a plus 30 pe for goog ex cash?

VAL9000

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Re: GOOGL - Google
« Reply #1878 on: April 24, 2018, 10:42:44 AM »
Aswath Damodaran on Alphabet

https://www.youtube.com/watch?v=17UjaSk0x7c

Interesting.

I agree that operating margin at Google is very carefully managed.  However, his revenue growth assumptions seem overly conservative.  GOOG dropping from reliable 20%+ growth y/o/y to 12.5% y/o/y overnight, then further to 2.75% after 5 years seems really unlikely.  My own modeling assumes a reduction in growth rate of 1% per year over the next 15 years to stabilize at 5%.  This would give a substantially higher valuation than $969.  But nice to see that other than a differing view on input variables our two different models come up similar.

My view is that Google is a reliable 15%/year compounder with a free option on another huge hit with Waymo.  I've been adding below $1,000.


Foreign Tuffett

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Re: GOOGL - Google
« Reply #1879 on: April 24, 2018, 10:43:45 AM »
Why do most (nearly all?) valuations of Alphabet not discount its net cash? They have ~$100 billion in cash + marketable securities, yet are fairly conservative in buying back stock and (obviously) don't pay a dividend. Similarly, the sheer size of the cash hoard, combined with antitrust concerns stemming from Alphabet's own size and market power, means that it's unlikely that more than a fraction of it can be productively used in M&A.

Take a look at page 60 of the most recent 10-K. Would you buy that collection of cash and marketable securities at NAV? If the answer is "no", then why aren't you discounting it for valuation purposes?