OptionPundit

GOOG: The King of Earning’s play is here (Part-1)

Written by

OptionPundit

in

Arguably, the most favorite stock for option traders is going to announce 4th Qtr earning results on Jan 31, 2007. This stock market darling has never (except once) missed the earning in the past.

SYMBOL
 PERIOD
 EPS ESTIMATE
 EPS ACTUAL
 PREV. YEAR ACTUAL
 DATE/TIME (ET)
GOOG Q4 2006 $ 2.90 n/a $ 1.54 31-Jan-07
GOOG Q3 2006 $ 2.42 $ 2.62 $ 1.51 19-Oct-06 AMC
GOOG Q2 2006 $ 2.22 $ 2.49 $ 1.36 20-Jul-06
GOOG Q1 2006 $ 1.97 $ 2.29 $ 1.29 20-Apr-06
GOOG Q4 2005 $ 1.76 $ 1.54 $ 0.92 31-Jan-06
GOOG Q3 2005 $ 1.36 $ 1.51 $ 0.70 20-Oct-05
GOOG Q2 2005 $ 1.21 $ 1.36 $ 0.58 21-Jul-05
GOOG Q1 2005 $ 0.92 $ 1.29 $ 0.53 21-Apr-05
GOOG Q4 2004 $ 0.77 $ 0.92 n/a 1-Feb-05 AMC
GOOG Q3 2004 $ 0.56 $ 0.70 n/a 21-Oct-04 AMC

Source: Above data is from http://www.earnings.com/ (an essential tool in OptionPundit’s toolbox).

Below is a snapshot from Reuters on what Wall Street is expecting from GOOG. If you observe from the below trends, you will notice that there are mixed signals. While revenues are rising across different time span, earnings are not. Earning estimates are trending up for both this qtr and next year, but declining for next qtr.

Consensus Estimates Trend

In U.S. Dollars
 Current
 1 Week Ago
 1 Month Ago
 2 Months Ago
 1 Year Ago
Revenue (in Millions)
Q4: 12/2006 3,135.10 3,122.83 3,122.73 3,121.07 2,819.46
Q1: 03/2007 3,510.41 3,510.76 3,509.43 3,501.09 3,199.03
FY: 2006 10,534.37 10,522.52 10,522.44 10,519.40 9,483.51
FY: 2007 15,231.49 15,194.50 15,169.00 15,176.62 12,898.47
EPS
Q4: 12/2006 2.90 2.89 2.89 2.87 2.52
Q1: 03/2007 3.23 3.24 3.25 3.24 2.83
FY: 2006 10.32 10.31 10.33 10.31 8.76
FY: 2007 13.90 13.87 13.86 13.79 11.97

How to make money from this announcement based on mixed signals? Well, Let’s start our jorney of exploring GOOG.

I would very much appreciate your comments, feedback and perspective. Keep pouring in ideas !!

Here is Part-2

Profitable trading,
OptionPundit

Comments

3 responses to “GOOG: The King of Earning’s play is here (Part-1)”

  1. GOOG : The King of Earning play is here (Part-2) at OptionPundit

    […] Google earnings, I discussed past earnings as well current earning and revenue trends for GOOG (click here for the post). Well, these are what Pros are expecting. The other side of the story is to look at what retail investors and traders are expecting and that is gauged by whispernumber.com. Surprise—  […]

    Reply
  2. GOOG : The King of Earning play is here (Part-3) at OptionPundit

    […] Google for speculative stock option trading startegy: In sequence to Part-1 and Part-2, here is part-3 that reviews a little more about Google’s business and key developments in last quarter: […]

    Reply
  3. How to play GOOG Earnings : Part-1 at OptionPundit

    […] Recap: I presented past earning data, sentiments, key development and some business data google in Part-1 and Part-2, and Part-3. Now Let’s discuss how to play this.  […]

    Reply

Leave a Reply

Your email address will not be published. Required fields are marked *

More posts