General presentation of Google:
Similar to Apple, Google appears to portray a true American success story to experts. This is all due to the creation of a tool that has become just about irreplaceable to us nowadays, the famous search engine, that the company managers have built their reputation upon.
We can underline the performance of the Google company with the fact that with despite starting with few means it has grown to become one of the major American companies.
The company Google Inc. was created in 1998 in Silicon Valley by its two founders; Larry Page and Sergey Brin who originally created this famous Internet search engine. Although competitors have since come to nibble at the market such as Yahoo or Bing, Google Inc. have successfully diversified their offer by proposing services such as Google Earth, unique in its sector.
Since its creation it has grown to be valued at 210 billion dollars on the market and has no less than 20,000 employees.
Since its beginning this company has not stopped increasing its revenue due to a highly efficient and particular style of management. Today it is one of the major Internet companies and possesses around 900,000 servers, the higher volume worldwide. Its famous search engine alone is responsible for nearly 6.4% of the worldwide internet traffic, a share that is constantly increasing.
To summarise, if you are interested in computer technology, the Internet or the general New Technology sector then Google Inc. is definitely a company to follow over the coming years and it would be judicious to invest on a rise in its share price.
The major competitors and partners of Google:
Google is currently the leader of online search engines worldwide with 70% of the market sector. It therefore leaves little room for competitors and yet there are a few companies that exercise their activities in the same sector and who try to compete with this American internet giant.
To enable you to better understand how Google is positioned in this activity sector and assist you in the improved monitoring of the growth of certain companies quoted on the stock markets in this sector, here are the major competitors to the Google Company:
- Baidu is currently number two in the online search engine sector and holds 19.82% of the market. It is actually a Chinese search engine that notably exercises its activity in China, the only country where Google is not the leader.
- Then we have the Bing search engine, published and created by the Microsoft Company that holds 8.11% of the market in the online search engine sector.
- Finally, Yahoo is the third competitor of Google with 7.68% of the market sector.
Concerning partners of Google, it appears that the Google Company has not formed any type of official alliances with other companies apart from the Sanofi Company. In fact, Google and Sanofi collaborated in the 2016 launch of a combined business specialised in the fight against diabetes. The objective of this company is to develop connected devices that particularly enable control of the blood glucose level and the administration of insulin for diabetics undergoing treatment.
This company was actually created between Sanofi and the mother company of Google, Alphabet, through its health based subsidiary Verily. It should be remembered that Google actually became Alphabet a few years ago.
Introduction and quotation of Google shares:
Google shares were introduced onto the stock market in 2004 and immediately scored a success with investors. It should be said that right from their launch the Google search engine achieved incredible success with the internet surfers thereby making a fortune for its two creators, Larry Page and Sergey Brin.
At the time of its entrance onto the stock market, Google shares were sold on the technologies market, the Nasdaq, at the rate of 85 U.S. dollars. In only a few minutes this price rose to 100.01 U.S. dollars, enabling the company to rise to a value of 1.67 billion dollars in one single day.
Since this time, Google company shares have not stopped attracting attention from numerous investors that speculate on the durability of the Internet sector and the development of new technologies and functions that this company offers.
Historical growth of the Google share price:
The Google Company share price has been quoted for a number of years on the NYSE (New York Stock Exchange) in the United States. Although this asset recently changed its name to become ‘Alphabet’, Google shares have an interesting history that is important to understand in order to comprehend the fundamental dynamics of this asset on the stock markets.
When we study the historical stock market charts of Google shares over the last decade we can above all observe a clear overall rising trend. In fact, although the asset price was around $230 in April 2007, at the end of 2016 it was over $800. This near quadrupling in the price of Google shares in only a decade shows clearly why it is such a profitable asset for investors with a long term investment strategy. Apart from a slight drop between December 2007 and December 2008, this asset has not stopped gaining points.
If you are planning a strategy over a shorter time period Google shares also offer plenty of possibilities. This is because numerous micro-movements, both rising and falling, both volatile and regular, can be observed relating to this asset.
Why purchase and trade in Google shares?
Firstly, the Google Company hasn’t really stopped growing and increasing since its creation in 1998. Due to innovations and acquisitions of other companies this group has become one of the global digital giants and continues to offer new products and services that revolutionise daily life.
We also note the strength of Google in terms of major investment in the domain of research and innovation
The advantages and strong points of Google shares as a stock market asset:
Before taking any long term position on the Google share price on the stock markets, particularly when using CFDs with online brokers, you should of course take the time to check the possibility of a rise or fall in this asset over the long term. This is why we offer you the opportunity to learn more here about the strengths and weaknesses of this company that could exert an influence on the financial results of this group over the medium and long term that could indirectly affect the movement of this company’s share price. Firstly then we shall examine the principal strengths of this company.
Initially, we can of course note as a major advantage the dominant position held by the Google search engine worldwide. In fact, in the specific area of online search Google remains the uncontested leader that holds the major market share far ahead of its competitors. To hold this position the American giant relies on constantly improving the technology used by its online search engine which leaves little opportunities for the other market players to take a larger share of the market.
Still on the subject of the Google’s strong points, we can also cite the major success enjoyed by its Android operating system. The Android operating system for mobile telephones was purchased by Google a few years ago and now this high tech group benefits from the massive rise in the use of smartphones worldwide many of which use this operating system. Due to the support of Google, and its well designed marketing strategy, Android is currently at the top of the market ahead of Apple, Microsoft and even Blackberry. The Android operating system in fact currently represents over 80% of the market and includes over a billion active users. To achieve this objective Android particularly relies on certain advantages such as the fact that it works on numerous telephone brands such as HTC, and Samsung, as well as cheaper mobile phones, which means it can reach a wide range of consumers contrary to its main competitor Apple of which the iOS system only works on certain brand devices which are relatively expensive to buy and therefore inaccessible to those with a smaller budget.
The disadvantages and weak points of Google shares as a stock market asset:
After reviewing all the different strong points of the Google group we now offer you the opportunity to learn about the weaknesses of this company that could contribute to a negative influence on this company’s share price over the medium to long term.
Firstly, we can of course highlight the fact that the profitability of the Google group depends greatly on advertising. In fact, it should be remembered that 90% of the Google revenue is generated by corporate and private advertising. The budget that these companies spend on advertising depends greatly on the economical situation and other factors such as the habits and spending power of consumers as well as the companies’ budget strategies. Therefore, all the elements that have a negative effect on the general economy could influence the advertising market and consequently the income of the Google group.
Finally the last negative point relating to Google relates to the lack of any great success achieved by the social networks the company tries to develop. In fact, although the Google group occupies first place on the online search market through its search engine of the same name, the company has experienced several setbacks concerning the social networks sector. In fact, since 2003, Google has tried to position itself in this market against the main player, FaceBook, but without experiencing any great success. Google has even been overtaken in this sector by several outsiders that have cropped up recently and implemented themselves in this highly popular sector.