Alphabet Inc (GOOG): thx, santa! Always appreciate a sincere...

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SeriousMoney

Re: santafe2 post# 1921

Friday, 12/23/2005 12:57:36 AM

Friday, December 23, 2005 12:57:36 AM

thx, santa! Always appreciate a sincere opinion, even when I agree with it. And everybody should always do their own DD and make their own buy-sell-hold decisions.

Now let's take a closer look at upside (potential gain) and downside (potential loss). Investors should consider the upside against the downside for each investment. The potential downside of a stock is 100%, but the upside is well let's use MSFT as example. Feel free to doublecheck the math.

MSFT closed @ 28 pps on 13-Mar-86, its first day of trading. Its potential loss or downside was 28.00 or 100% of investment.

What was its upside? Well, it could go up 1%, 5%, 10% 50%, 100% or more. Who really knew? MSFT and its future was unknown, and IBM ruled the world.

That $28 purchase of one share of MSFT, after 9 splits, is now worth $7,657.92, over 27,000% gain (minus commissions & fees). Each dollar invested is now worth $273.50. Unfrickn believable!

DATE PPS@close
13-Mar-86 28.00
22-Jul-87 100.00 = 257% upside
22-Dec-05 26.59 x 288 = 7657.92

MSFT Splits
21-Sep-87 [2:1]
16-Apr-90 [2:1]
27-Jun-91 [3:2]
15-Jun-92 [3:2]
23-May-94 [2:1]
09-Dec-96 [2:1]
23-Feb-98 [2:1]
29-Mar-99 [2:1]
18-Feb-03 [2:1] = 288 shares
http://finance.yahoo.com/q/hp?s=MSFT

Now GOOG closed @ 100.34 pps on 19-Aug-04 its first day of trading. It is now @ 432.04 pps at close 22-Dec-05. That's $331.30 or 330% gain against $100.34 or 100% downside. Each dollar invested is now worth $4.32.

DATE PPS@close
19-Aug-04 100.34
22-Dec-05 432.04 = 330% gain
http://finance.yahoo.com/q/hp?a=&b=&c=&d=11&e=23&f=2005&g=d&s=goog

If GOOG should reach 575 pps as JMP now targets, that would be $474.66 or 473% gain against that $100.34 or 100% downside of original investment. Each dollar invested would be worth $5.75.

But what is GOOG's pps upside (potential gain) from this point forward? Well, it could go up another 5%, 10% 50%, 100% or more. Who really knows? GOOG is known but its future beyond a quarter or two is not very clear, is it? And MSFT rules the world, doesn't it?

If GOOG should match MSFT's 27,000% performance, that one share of GOOG will be worth over $27,000.00. If only half of MSFT's performance (13,500%), then $13,500. And if only a forth of MSFT's performance (6,750%), then $6,750. And so on.

If a share of GOOG is purchased this Monday @ 432 pps and GOOG's performance should be a forth of MSFT's, it would be worth $6,750 or 1,462% gain against a $432 or 100% downside! Each dollar would be would be worth $15.63.

So what is GOOG's upside or potential gain from this point forward? I guess it depends on what people expect it to be, doesn't it?

"Growth is all that matters!" CRAMER