GOOGLE
Financial Analysis Report
Prepared for:
Financial Management Class –
Florida Institute of Technology
February 2011
TABLE OF CONTENTS
EXECUTIVE SUMMARY 3
COMPANY INTRODUCTION 4
FINANCIAL ANALYSIS 5
Summary Financial Analysis Report 6
WEIGHTED AVERAGE COST OF CAPITAL (WACC) 10
FUTURE CASH FLOWS 12
ANALYSIS OF CASH FLOWS 13
Sensitivity Analysis of Google’s 2011 Future Cash Flow 14
Sensitivity Graph for Google’s 2011 Future Cash Flow 15
Sensitivity Graph for Google’s 2011 Future Cash Flow 15
Inflation Analysis 15
Google Inc. Discounting Future Cash Flows for Inflation @ 1.7%: 16 Footnotes effect on future cash flows 17
Analysis of Google Competitors 19
ANALYSIS OF CASH
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Furthermore, because Google’s employees d are also equity holders, morale is high and Google encourages its employees to feel a part of Google’s success.
In conclusion, Google is a sound investment that according to the analysis will continue to increase their profits and their dominance in the marketplace.
COMPANY INTRODUCTION
In 1998, Stanford University graduates Larry Page and Sergey Brin combined their ingenuity and built a search engine called “BackRub” that evolved into what is now known as Google. Google, with over 150 domains, now functions as a search engine that offers many different products and services including web applications, advertising, sports scores, stock quotes, headlines, addresses, videos, etc. Google’s focus is “to provide useful and relevant information to the millions of people around the world as they rely on us (Google) to provide the answers they are seeking.”
The strategy of focusing on getting information to millions of people internationally is the foundation of Google. Another strategy in which Google is unique is their culture. Google creates an atmosphere of creativity, teamwork and brainstorming which has helped win them a spot in the top 10 of Fortune magazine’s best companies in which to work.
Google offers services such as search advertising, display advertising, mobile advertising, tools for publishers,
Google Inc. is one of the leading computer search engines in the world and is continuing to grow as the
Google Inc., American search engine company founded in 1998 by Sergey Brin and Larry Page. Google handled 70 percent of worldwide online search requests, placing it at the heart of most Internet users’ experience. Even though Google’s essential core business is search service, it now offers more than 50 percent Internet services and products from Gmail and online document creation to software for mobile phones and tablet computers. Google successfully maintained its core competence meanwhile expanded its business to advertisement and application three major core businesses. Its success in market levitates Google’s growth by acquiring other tech companies as a way of horizontal integration. For example, its 2012 acquisition of Motorola Mobility put it in the position to sell hardware in the form of mobile phones. Google’s broad product portfolio and size make it one of the top influential conglomerate companies in the high-tech market place. Google plays a very vital role in ICT ecosystem and it is one of the forces that enhance the growth of entire ICT ecosystem. For further illustrating the ICT ecosystem, I chose Apple and Comcast as device and Internet infrastructure firm to compare and contrast against Google.
Google Company is one of the global leaders in technology and in enabling people access information from the internet through their efficient search engines. Google immediately gained the attention of the internet sector for being a better search engine than its competitors (Wheelen, Hunger, Hoffman, & Bamford, 2015). This was after a tremendous effort in marketing their services and capturing a large market worldwide. However, there being so many risks and challenges in this line of business Google has had the urge to come up with new strategies so that they are able to overcome any challenge before them. The major problem that Google has
Google’s search engine allows users to input and submit data online. In return, the user would receive relevant search results. Behind the scenes upon the submission, web crawlers scan through billions of pages and link keywords from a user’s data to the publish data on the web. Their PageRank technology ranks these pages by the number and popularity of other sites that link to the page. This provides the user with accurate and popular results. Google search engines generated high revenues between advertising on its websites and selling its technology to other sites.
Hi Jim, Impressive report on Google, the fact that this online organization has a multinational technology, specializing in not only advertising technology but cloud computing and software. Google is a household name for search engines, whenever people search online it is google search that retrieves the information. Amazing how an organization incorporated in 1996 that went public in 2004 now has over 1 billion searches daily. I also use one of the free gmail accounts that google offers that is known
Google Inc. was founded in 1998 by Larry Page and Sergey Brin. By 2000 it had become the world 's largest search engine. This case study will examine the rise of the Google search engine, how it differs from its competitors, and possible threats it may face going forward.
Founded on September 4, 1998 Google quickly revolutionized the search engine and the Internet alike. Within two years of starting operations Google had become the largest single search engine in the world and began to dominate the market. As the World Wide Web (web) grew in popularity and became more and more a part of everyone’s daily life, Google too grew in popularity “because it could provide simple, fast, and relevant search results” (Deresky, 2011). The differentiating factor was Google’s “PageRank technology which displays results…by looking for keywords inside web pages, but also gauging the importance of a search result based on the number and popularity of other sites that linked to the page” (Deresky,
Google is a multinational corporation that serves thousands of consumers worldwide. Through Internet related products such as Internet searches, maps, emails, mobile apps, and other online contents for users Google became the company it is today. Every employee of Google is different in his or her own way; making it a well-diversified organization similar to the global audience they serve. Google’s mission statement is to organize information from all around the world and make it universally accessible at a quick and orderly fashion. This means creating a search engine smart
The company's official mission statement is "to organize the world's information and make it universally accessible and useful" (Google, 2012). Google hires people who are smart and determined, and the organization favors ability over experience (Google, 2012). Google is one of the top tech companies in the world and as a result it attracts some of the world's top talent. Although many of the employees share common goals and visions for the company, they all hail from different walks of life and speak dozens of languages, reflecting the global audience they market to.
Google is a company that was conceptualized in a dorm room by two Stanford University college students in 1996 (Arnold, 2005, p. 1) and has morphed into one of the greatest technological powerhouses in operation today. What began as merely a means to analyze and categorize Web sites according to their relevance has developed into a vast library of widely utilized resources, including email servicing, calendaring, instant messaging and photo editing, just to reference a few. Recent statistics collected by SearchEngineWatch.com reflects that of the 10 billion searches performed within the United States during the month of February, 2008, an impressive 5.9 billion of them were executed by Google (Burns, 2008). Rated as Fortune Magazine’s
For this research paper, I would like to select Google Inc. as a public company. This research paper would be helpful to prepare horizontal analysis of income statement and balance sheet of Google Inc. and to perform ration analysis to know the financial performance of the company.
Google is the most successful information technology and web search company in the world. It was founded in 1998 by two Stanford Ph.D. students, Larry Page and Sergey Brin. The company name, Google, is a play on the word “googol” which is a mathematical term for the number 1 followed by 100 zeros. Larry Page and Sergey Brin chose this name to reflect the large amount of information on the web. The two created this search engine so that people can find anything on the web all in one place. The company’s mission is “to organize the world’s information and make it universally accessible and useful.” Now, the company is far more than a search engine website, it has grown to be a substantial collection of products and services that are
Google has dominated ⅔ of the US internet search and 70% worldwide. Google Maps, Youtube, Chrome, Android and etc., there are billions of users using Google's products. Now Google has created a new company called Alphabet. Larry Page will be the CEO of the company and Sergey Brin for the president. What is Alphabet? Alphabet is a collection of companies. Alphabet is about business prospering through strong leaders and independence. Its model is to have a strong CEO who runs each business. The company recorded revenues of $66,001 million during the financial year ended December 2014. The strong growth in the revenues were driven by an increase in advertising revenues generated by Google websites. The operating profit of the company was $14,444 million in December 2014,
Google is one of the most successful corporations that have ever been established. Through innovation, persistence, growth,
Professionally, Google is known as a company based in California that is labeled as an internet company which is multi-national. It provides online searching, as well as cloud computing, software, and advertising. The company actually didn 't start off as a company, but rather as a research project back in 1996. The project was being conducted by Sergey Brin and Larry Page who at the time were studying at Standford University as PhD students. At the time, in internet-land, the search engines that existed operated where they ranked the results by counting the number of times keywords results were on a page. The two students came with a better idea (called PageRank at the time), that looked at relationship between websites. It would rank websites by determining it 's relevance, which was based on the importance of pages, and the number of pages, and how it linked back to the main website. After the idea 's creation, the two founders made the project into a business, and changed the name to "Google", which is a neat miss-spelling of the word "googol" which had significance because it stands for the number one followed by one hundred zeros, and it related to their goal because they wanted to create a search engine that offered a large quantity of information.