Stock to Buy: Google
Google is in the enviable position of low expectations on the hardware front; I’m not talking about goofy Google Glass, but instead the Nexus family of devices and the rumored “X Phone.” Even if GOOG falls a bit short, it’s not like investors have everything riding on one hardware launch.
But don’t think Google is a messy operation content with simply throwing things up to see if they work. Ever since 2011, when Larry Page took over as chief executive, a number of creative but money-losing efforts have fallen by the wayside. Google Reader is just one recent example of the cost-cutting victims.
At the same time, Google has gotten more aggressive about cross-marketing its products or using litigation to protect patents and fight back antitrust lawsuits. Some claim Google is going back on its motto “don’t be evil,” but I say it’s simply a $300 billion business acting like a $300 billion business. There’s nothing wrong with focusing on the bottom line, and subsequently, your investors.
One caveat: Just remember that Google doesn’t make much money on the OS yet and that overall smartphone operations aren’t a primary driver of revenue right now, so investors need to keep in mind that the underlying ad business still is what makes Google tick.