03 mars 2008

A $17B report

In this very nervous market, every piece of information, not read the right way, can have disastrous effect.
Last week, comScore reported a 8% decrease in paid click per search query, in January vs December. Immediate market reaction was a $55 drop per share over two nervous sessions. This means a $17B drop in Google valuation. Reading straight numbers from comScore is a dangerous exercice. So dangerous, even comScore's CEO had to make some explaination [good article from Forbes here]
Google did introduce a "quality factor" that simply translate in raising the bar for paid clicks to be displayed, producing higher paid clicks. All in all, quality vs quantity. So, do people invests in a number of clicks or in a company financial performance?
comScore's CEO statement makes the point, reading numbers requires caution before action and, if you ask me, at $471 Google is a bargain theses days... ;-)


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