Author Topic: GOOGL - Google  (Read 576228 times)

Liberty

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Liberty

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Re: GOOGL - Google
« Reply #2031 on: January 17, 2020, 01:36:54 PM »

Liberty

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Re: GOOGL - Google
« Reply #2032 on: January 20, 2020, 06:35:00 AM »

griezeman23

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Re: GOOGL - Google
« Reply #2033 on: February 04, 2020, 07:23:34 AM »
Google committing to $6bn+ per quarter, $24bn per year, in buybacks. Also, the co. did provide way more disclosure. You can really see the changes being made by Ruth and Sundar with Larry and Sergei gone. I wonder if the larger share repurchases point to Google moving into a bit more of a harvest mode, with regard to certain businesses of course (Networks and Search spring to mind).

Now with a 2.5% buyback yield plus all the associated growth even at ~30x trailing FCF (CFO - CapEx), ex-cash, its not a terrible value proposition even with the regulatory overhang. THe co. still has plenty of catalysts (Waymo, Cloud scaling, YouTube scaling) too.

dutchman

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Re: GOOGL - Google
« Reply #2034 on: February 04, 2020, 07:35:04 AM »
the buybacks barely cover dilution

griezeman23

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Re: GOOGL - Google
« Reply #2035 on: February 04, 2020, 07:41:18 AM »
Ah yes, forgot about dilution. Still share count is down another 5mn y/y. So closer to 5/7 of a percent a year in a "buyback" yield, which is more or less nothing. Just got excited re-reading the call!

Definitely, the best call I have listened to in several years...
« Last Edit: February 04, 2020, 07:55:18 AM by griezeman23 »

Liberty

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Re: GOOGL - Google
« Reply #2036 on: February 04, 2020, 07:56:24 AM »
They broke out Google Cloud but include G Suite numbers with GCP, so we still can't know for sure... I wish they'd just have GCP. Otherwise, it's like MSFT putting Office 365 numbers with Azure, makes things less clear.

StevieV

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Re: GOOGL - Google
« Reply #2037 on: February 04, 2020, 08:13:03 AM »
Ah yes, forgot about dilution. Still share count is down another 5mn y/y. So closer to 5/7 of a percent a year in a "buyback" yield, which is more or less nothing. Just got excited re-reading the call!

Definitely, the best call I have listened to in several years...

I sometimes see share buybacks dismissed because they only offset dilution.  As in, a company shouldn't do buybacks because it only offsets dilution.  While I can share in the disappointment of share count not actually decreasing, I think that share buybacks offsetting dilution should not be dismissed.

Share issuances and buybacks are two separate decisions.  If a company is going to issue shares, they are going to do so whether or not they have a buyback.  Say you have 2% dilution due to share issuances.  A 2% buyback isn't a bad thing or worthless.  It is the difference between a flat share count and 2% dilution.  If someone doesn't like it, they should direct their ire at the share issuances, not the buyback.


Kaegi2011

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Re: GOOGL - Google
« Reply #2038 on: February 04, 2020, 09:43:39 AM »
I sometimes see share buybacks dismissed because they only offset dilution.  As in, a company shouldn't do buybacks because it only offsets dilution.  While I can share in the disappointment of share count not actually decreasing, I think that share buybacks offsetting dilution should not be dismissed.

Share issuances and buybacks are two separate decisions.  If a company is going to issue shares, they are going to do so whether or not they have a buyback.  Say you have 2% dilution due to share issuances.  A 2% buyback isn't a bad thing or worthless.  It is the difference between a flat share count and 2% dilution.  If someone doesn't like it, they should direct their ire at the share issuances, not the buyback.

I don't think it's irritation from buybacks offsetting dilutions (or partial dilutions).  I think the point was that when one does a relatively simple FCF calc (OCF - capex) the number is misleading, bc dilution can be significant, especially for tech companies.  My quick math suggests that half of the buybacks went to offset dilution last year for Google.  Not that they shouldn't have done the buyback - just that if I'm looking at a FCF yield I need to be sure that I'm doing apples to apples, or at least remember to take out the dilution impact from my figures. 

villainx

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Re: GOOGL - Google
« Reply #2039 on: February 04, 2020, 10:30:05 AM »
The way I see it is what was rate of dilution prior to buyback starting.