Investors Now Willing to Risk More with Google (GOOG) Versus Apple (AAPL)
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Gaps can generally be a good thing. You'd want your hometown sports team to win by a wide gap. A large gap between yourself and evil doers is generally more favorable.
However, sometimes a smaller gap is wanted. For example, the share price-to-profit gap between Apple (Nasdaq: AAPL) and rival Google (Nasdaq: GOOG) is at its widest point since June 2005, according to Bloomberg-compiled data. Not good if you're an Apple investor.
Google is going for 25 times profit, while Apple is at just 10 times, indicating that investors are willing to pony-up 150 percent more per dollar of return at Google.
Sentiment could come from multiple data points. For example, Google controls about 70 percent of the smartphone software market thanks to its Android operating system. That means Google will be able to see a little more benefit as users switch from PCs to smartphones and tablets, as well as the ongoing shift to digital advertising.
But, one B. Riley analyst sums it up pretty well: while Google has seen success in several areas of the Internet, from social to mobile, Apple has really only been a powerhouse in devices.
In mid-2011, Google came under scrutiny as many saw little opportunity for growth outside of search ads. Facebook (Nasdaq: FB), Amazon.com (Nasdaq: AMZN), and Apple were all dominating their respective markets: social, shopping, and devices. Google was also under regulatory scrutiny over privacy issues.
With Google expected to draw about 55 percent of U.S. mobile ad revs this year and 57 percent next year, according to EMarketer, times have never looked better.
There are some signs of hope for Apple to rebound: plans for a new TV set, the revamp of key devices, and a new wristwatch. Apple CEO Tim Cook was as said to be in talks with Beat Electronics over its upcoming music-streaming service, though discussions around partnership plans weren't confirmed.
Google still hasn't unlocked the full potential of its Motorola Mobility acquisition last year. The company also draws the lions share of its revenue from search advertising, while mobile ad revs aren't nearly as profitable, yet.
While Google is currently in the limelight, investors should focus toward the second-half of 2013. Apple will be releasing products through the year and any new devices probably won't make a debut before the third quarter. Meanwhile, Google will continue its push into mobile devices with Google Glass, a portable, augmented reality computing device.
Both Apple and Google are lower on the session Tuesday.
However, sometimes a smaller gap is wanted. For example, the share price-to-profit gap between Apple (Nasdaq: AAPL) and rival Google (Nasdaq: GOOG) is at its widest point since June 2005, according to Bloomberg-compiled data. Not good if you're an Apple investor.
Google is going for 25 times profit, while Apple is at just 10 times, indicating that investors are willing to pony-up 150 percent more per dollar of return at Google.
Sentiment could come from multiple data points. For example, Google controls about 70 percent of the smartphone software market thanks to its Android operating system. That means Google will be able to see a little more benefit as users switch from PCs to smartphones and tablets, as well as the ongoing shift to digital advertising.
But, one B. Riley analyst sums it up pretty well: while Google has seen success in several areas of the Internet, from social to mobile, Apple has really only been a powerhouse in devices.
In mid-2011, Google came under scrutiny as many saw little opportunity for growth outside of search ads. Facebook (Nasdaq: FB), Amazon.com (Nasdaq: AMZN), and Apple were all dominating their respective markets: social, shopping, and devices. Google was also under regulatory scrutiny over privacy issues.
With Google expected to draw about 55 percent of U.S. mobile ad revs this year and 57 percent next year, according to EMarketer, times have never looked better.
There are some signs of hope for Apple to rebound: plans for a new TV set, the revamp of key devices, and a new wristwatch. Apple CEO Tim Cook was as said to be in talks with Beat Electronics over its upcoming music-streaming service, though discussions around partnership plans weren't confirmed.
Google still hasn't unlocked the full potential of its Motorola Mobility acquisition last year. The company also draws the lions share of its revenue from search advertising, while mobile ad revs aren't nearly as profitable, yet.
While Google is currently in the limelight, investors should focus toward the second-half of 2013. Apple will be releasing products through the year and any new devices probably won't make a debut before the third quarter. Meanwhile, Google will continue its push into mobile devices with Google Glass, a portable, augmented reality computing device.
Both Apple and Google are lower on the session Tuesday.
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