Posted by: Karyn McCormack on January 18, 2006
The overloved stock Google has lost two admirers in the last two days. On Jan. 17, Scott Kessler at Standard & Poor’s Equity Research downgraded Google to sell from hold (I interviewed him earlier and a story will appear on our site later today). This morning, analyst Scott Devitt at Stifel Nicolaus followed suit. As I write this in the last hour of trading, the stock is down 21.76, or nearly 5%, to 445.35.
This is quite a shift from just a few weeks ago, when a Piper Jaffray analyst slapped a $600 price target on the stock. At this point, of the 40 analysts covering Google, 29 have a buy recommendation, 8 have a hold, and 3 have a sell, according to John Butters, a research analyst with Thomson Financial.
I wonder if the ascent in Google shares is coming to an end. Will investors suddenly pay more attention to what the company is worth and risk rather than following a herd? Please tell us what you think.