|Can Google’s Chromebook Compete With Apple?Picture/Image|
Since then, Google's market value shrunk by roughly $40 billion, expenses and headcount have mushroomed, and the company has done little to diversify its income stream and reliance on search.
Today, Google is about half the size of Apple, and its stagnant stock is testing the patience of an increasing number of investors and analysts who are hungry to see its next big product. "Google has been a one-trick pony as far as earnings are concerned," says portfolio manager Michael Sansoterra of Silvant Capital Management. Like the rest of us, he is taking a wait-and-see attitude toward the new Chromebook laptops that begin shipping today, and asking for a "show-me story."
In a marketplace dominated by $500 iPads, it remains to be seen if consumer demand for the comparably priced but lesser-equipped Chromebook, a device Sansoterra describes as "a tablet with a lid and a keyboard," will do anything to compete with tech giants like Apple. The iMac maker has a proven its "ability to innovate and grow their business," Sansoterra says.
He adds there might still be room to buy shares because "Apple is a very, very large company that's selling at a very reasonable multiple. Everybody knows the story and likes it, but it's very hard for them to surprise to the upside."
Sansoterra already owns both stocks, but when asked which he would put new money into today if he could only buy one of them, his answer is clear and unequivocal -- Apple.
So the Chromebook may take its place in a very long line of Google projects that have yet to deliver much in the way of new revenue and earnings that investors crave from the Sultan of Search. But what do you think? Did Google finally get it right?
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By : Fareeha