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Tuesday, October 24, 2006

Cramer on MAD MONEY: 10/24/06 Positive on Google Again

According to Cramer: Google (GOOG) hit a new high yesterday, and all of a sudden he thinks everyone has an opinion. He thinks his low-ball conservative number is that it goes to $560.00. He said that his opinion doesn't drivve it, but portfolio managers drive it. He said portfolio managers may get scared at the share price tag, but if they see that $14.00 earnings they will jump. Cramer said that if you compare this to other similar growth names out there. The 5 fastest big cap growth names to compare it to are (and Cramer gave some comparable price targets if you used the same valuations for GOOG that the street uses for these):

1) Starbucks-SBUX at 53-times forward earnings; a $740 price.
2) Whole Foods-WFMI at 20% EPS growth is priced at 46-times, so you would have $640 if he used WFMI.
3)F5 (FFIV) grows 23% earnings growth at 20-times, and would be $546.
4) Akamai (AKAM) 25% earnings growth at 56-times. $784 price equivalent.
5) Hologic (HOLX) $826 price equivalent.

Cramer was saying it isn't too late to get on it and it shouldn't stay this low.

Jon C. Ogg
October 24, 2006
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