Lithium Charge: Secretary Chu Announces New Funding and Partnership with Google to Promote Electric Vehicles goog, tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, gm, dai, rno.pa, hev, aone, vlnc

  "We are always searching for the catalyst for particular investment idea. We have our big picture Macro Catalyst in action now with S&P putting US on Negative outlook and Bill Gross selling all US Treasuries. The Powerful Macro trend of Peak Oil multiplied by Inflation will make Electric Cars the reality in the nearest future. Here, the Gas prices will be the very good incentive for keeping the topic in the headlines.

  We have an industry catalyst in Electric Cars now: China has announced that Electric cars will be strategic industry in its 12th Five Year Plan, IMF talks about Peak Oil and higher Oil prices and new Electric Cars are hitting the roads and showrooms.

  On the company level, a catalyst comes when strategic investors are buying stakes in the new players, after a few months spent on full due diligence with the company and its properties. TNR Gold is already a part of Byron Lithium index and we think that International Lithium will get on the radar screens now after its IPO." 

   The Electric Cars investment space is getting hotter and big names are beginning to eagerly to pile in. The 5 million investment into the charging infrastructure from U.S. Department Of Energy could sound like a joke compare to China investing billions in Electric Cars or personal investments of some entrepreneurs in Lithium space, but it is one step at a time and names in this initiatives are more important than this amount.
  Once the guys from Google, Facebook and Twitter will move into Green Revolution our Lithium story will take off into parabolic rise - they have knowledge, technology and understanding that Electric Cars are the way forward. They will need to drive their kids to the soccer games after all, even after Peak Oil which is happening now. We do not know which one of them will make the next Coca Cola in Electric Cars space, but we will be ready with our Sugar business - Lithium will be needed for all of them.

  We can only dream that Steve Jobs will enter this space with Apple, it is heartening to see Google guys driving Teslas already, they were behind Aptera and now Google is investing in the Wind Farm.

  The ambitious German guys are driving the Lithium dreams with new Lithium Metal Polymer battery; DBM Energy has announced this month new breaking developments and very impressive test results.

"We have the breaking news from Germany and DBM Energy. Information is very scarce at best and only in German so far. Revelations from this hidden in the heart of Germany company are groundbreaking: KOLIBRI Lithium Metal Polymer Batteries (Lithium-Polymer-based technology) have passed extensive independent safety tests and demonstrated endurance of 5000 charging cycles. New independent test confirms 454.82 km driving range on one charge! But company claims that the battery in this case was smaller: KOLIBRI 62.928 kWh and that it translates in 714 km range in case of previously used 98.8 kWn battery in the DBM World Record Electric Car Drive in October 2010! To put things into perspective, in case when you drive 225 km every day you will need to recharge the car equipped with this battery every other day and this battery will last 27 years."

ENERGY.GOV

April 19, 2011

Secretary Chu Announces New Funding and Partnership with Google to Promote Electric Vehicles

Since its inception in 1993, DOE's Clean Cities program helped save nearly 3 billion gallons of gasoline

Washington, DC - As part of the Obama Administration's efforts to reduce U.S. oil imports by one-third by 2025, Energy Secretary Steven Chu today announced new steps underway at the Department of Energy to accelerate the deployment of electric vehicles.  This includes the availability of $5 million in new funding for community-based efforts to deploy electric vehicle (EV) infrastructure and charging stations. He also outlined a partnership with Google Inc. and more than 80 EV stakeholders to help consumers find charging stations nationwide. Secretary Chu and Transportation Secretary Ray LaHood made the announcement on a conference call with Colorado Governor John Hickenlooper, Tucson Mayor Bob Walkup, and St. Paul Mayor Christopher Coleman - leaders of three of the nation's nearly 100 Clean Cities Coalitions.

"The Department of Energy's Clean Cities initiative is bringing together local governments and industry to demonstrate the benefits of advanced technology vehicles and help communities use less oil and gasoline to power their vehicles," said Secretary Chu. "The initiatives announced today are just the latest steps in our broader efforts to reduce America's dependence on oil, improve our energy security, and save families and businesses money."

Under the $5 million in electric vehicle funding announced today, local governments and private companies will partner to apply for funding to help accelerate installation of electric vehicle charging stations and infrastructure. Communities will work to develop plans and strategies for EV deployment, update their EV permitting processes, develop incentive programs, or launch other local or regional initiatives that improve the experience of EV users and help bring these highly energy-efficient vehicles in the marketplace. More information on the Funding Opportunity Announcement, including application instructions and deadlines, is available FedConnect.net under the title "DE-FOA-0000451 Clean Cities FY 2011 FOA."

In a related effort, DOE's National Renewable Energy Laboratory (NREL) is joining with Google Inc. and various industry leaders to provide consumers with consistent, up-to-date information about the EV charging stations in communities nationwide.  Drawing on Google Maps, this new collaboration will coordinate an online network of all U.S. charging stations and will serve as the primary data source for GPS and mapping services tracking electric vehicle charging locations. More information is available on the Alternative Fuels and Advanced Vehicles Data Center(AFDC).

The Clean Cities Program is a public-private partnership that brings together federal, state and local governments, the auto industry, private sector fleet operators, and community leaders to help communities make their vehicle fleets more energy efficient. Since its inception in 1993, Clean Cities Coalitions and its stakeholders have saved nearly 3 billion gallons of gasoline. The Clean Cities Program supports a broad portfolio of technologies, including alternative and renewable fuels, fuel economy measures, idle reduction technologies, and emerging technologies like electric vehicles.  Read more information on the Clean Cities program.

Tucson, Arizona; Denver, Colorado; and St. Paul, Minnesota have been three of the leaders nationally in developing policies to reduce the dependence on oil and gasoline locally.  Projects underway include the deployment of electric vehicles and chargers, E85 flex fuel vehicles and infrastructure, biodiesel facilities that turn used cooking oil into vehicle fuel, natural gas vehicles, and consumer education efforts.

Below is a chart of top 25 Clean Cities Coalitions and amount of gasoline their efforts have helped displace from 2005-2009:

Rank	State	Coalition	Cumulative Displacement 2005-2009 (Gallons of Gasoline)
1	MN	Twin Cities Clean Cities	135,175,133
2	AZ	Valley of the Sun Clean Cities (Phoenix)	86,739,806
3	OH	Clean Fuels Ohio	84,137,431
4	IN	Greater Indiana Clean Cities	67,576,029
5	NY	New York City and Lower Hudson Valley Clean Communities	63,728,157
6	MD	State of Maryland Clean Cities	53,849,126
7	IL	Chicago Clean Cities	47,758,243
8	CA	Los Angeles Clean Cities	47,524,841
9	TX	Dallas-Ft. Worth Clean Cities	44,525,015
10	CA	Southern California Clean Cities	42,295,552
11	KY	Commonwealth Clean Cities Partnership	38,495,681
12	AZ	Tucson Clean Cities	37,138,418
13	NY	Greater Long Island Clean Cities	32,865,885
14	CA	Western Riverside County Clean Cities	31,734,027
15	WA	Puget Sound Clean Cities (Seattle)	29,387,885
16	MO	St. Louis Clean Cities	29,269,485
17	KS	Kansas City Regional Clean Cities	27,409,150
18	CA	San Joaquin Valley Clean Cities	26,569,597
19	CO	Denver Clean Cities	24,030,743
20	UT	Utah Clean Cities	23,577,151
21	OR	Columbia-Willamette Clean Cities	22,495,293
22	CA	San Diego Clean Fuels Coalition	21,765,744
23	GA	Clean Cities-Atlanta	21,172,066
24	TX	Central Texas Clean Cities (Austin)	20,218,686
25	NV	Las Vegas Clean Cities	19,687,387

Media contact(s):

(202) 586-4940

Related articles

• DBM Energy: KOLIBRI Lithium Batteries Passed Safety Tests. New Independent Range Test Confirms 455 km On One Charge! tnr.v, czx.v, rm.v, lmr.v, alk.ax, lun.to, tsla, sqm, fmc, roc, lit, li.v, wlc.v, clq.v, res.v, ree, avl.to, nsany, f, gm, rno.pa, dai, b (sufiy.blogspot.com)
• Lithium Charge: President Obama on Gas Prices, Energy Security and Electric Cars tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, gm, dai, (sufiy.blogspot.com)
• Lithium Charge: 25 Most Electric Car-Ready Cities, Ranked by Ford. Is Yours on the List? tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, g (sufiy.blogspot.com)
• Lithium Dreamz: Past, Present and Future of Electric Cars tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, gm, dai, rno.pa, hev, aone, vlnc (sufiy.blogspot.com)
• Lithium Charge in China: Foshan Electrical Advances on Lithium Battery Venture With Hefei Guoxuan tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, (sufiy.blogspot.com)
• Lithium Drive: Electric Cars at 2011 New York International Auto Show tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, gm, dai, rno.pa, he (sufiy.blogspot.com)
• Lithium Drive: Clean Air: Beijing to become a paradise for Electric Vehicles sales tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, gm, (sufiy.blogspot.com)
• Lithium Investments: Richard Mills: Strategic Investor For International Lithium tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, gm, dai, (sufiy.blogspot.com)
• Powered by Lithium: China Plans 220,000 EV Charge Points and 2,351 Battery Switch Stations tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, (sufiy.blogspot.com)
• Lithium Charge: Network Of Charging Stations For Electric Cars - eVgo North Texas Launch tnr.v, czx.v, alk.ax, lmr.v, tsla, rm.v, nup.ax, srz.ax, usa.ax, jnn.v, abn.v, res, mcp, avl.to, quc.v, cee.v, sqm, fmc, roc, li.v, wlc.v, clq.v, lit, nsany, byddf, g (sufiy.blogspot.com)

Test Zemanta GOOG, AAPL, RIMM, IBM,

We are testing Zemanta today. Interesting to find out whether we can increase productivity for our blogging and make content more appealing to our audience. Image library, cross referencing and linking are the most promising propositions for us and we will find out what exactly we can incorporate in our posts shortly. With Lithium on the rise in mass media we need to be prepared to be at the forefront of technological advance in blogosphere as well.

Related articles by Zemanta

• Zemanta For Blogger ?! (sedatkurtulus.blogspot.com)
• Zemanta now Available in Blogger Platform (ashout.com)
• Zemanta Gets Blog Love From Blogger (centernetworks.com)

Google Might Be Investing in Electric Cars TNR.v, CZX.v, WLC.v, LI.v, RM.v, LMR.v, SQM, FMC, ROC, TT, TTM, BYDDY, NSANY, DAI, BMW, VLNC, PC, AONE, HEV

"Availability of serious capital for Better Place and Nissan is very encouraging. You have to make your homework right in order to find the right financing opportunities in Electric Cars value chain. Newcomers on Technology or Auto making side will be evaporated overnight by Toyota situation as it is today. It is time when very risky plays on Lithium and REE supply side could provide actually more security as a sector entry with at least technology risk minimised."

Tesla IPO will bring a lot of attention to the Electric Space. Google founders investing in it or even Google itself will bring the story out into the mass media headlines. Market has to climb the wall of worry and such high profile investors will bring necessary comfort for the investors to move into Electric Cars value chain - they will find out very soon that there is not enough pure plays for the magnitude of capital which could be involved. We will have situation in Gold, Majors and Juniors in 2003-2005: First capital moved into gold, than into Major producers and than Juniors took off with multiples to the market cap, when capital was chasing very small market with very hot stories.

ValleyWag:

"Google Might Be Investing in Electric Cars

Tesla wants to go public. But the electric car company, loved by California celebrities and nerds alike, had to first bare all to the SEC. So now we know Tesla is funded by a mysterious front company linked to Google.
Tesla registered with the SEC on Friday. Buried in the copious paperwork is the name of a very interesting "Series C" and "Series E" stockholder: Amphitheatre LLC. We first flagged this entity as a possible Google front when it invested in a zeppelin company started by Google advisor Esther Dyson. The same zeppelin company was later hired by 23AndMe, the Google-funded and -housed genetic testing firm co-founded by the wife of Google co-founder Sergey Brin.
Ampitheatre LLC may well have been acquired by Google along with the company INV Tax Group when Google bought its eight-building headquarters at 1600 Amphitheatre Parkway and 1200-1500 Crittenden Lane in Mountain View. Ampitheatre LLC and INV Tax Group, then believed affiliated with Goldman Sachs, had been the shell companies that held the buildings.
It's hard to imagine why a real estate holding vehicle is now investing in zeppelins and electric cars if it's not controlled by Google. California records are little help; they show the LLC still registered to "INV Tax Group, 180 Maiden Lane, 40th floor," an address once linked to Goldman Sachs in a building now used by a wide array of companies.
Google's a logical investor, anyway, since its founders are already Tesla customers (see picture of Brin in his Tesla, left, by Zach Graves) and investors. Co-founder Larry Page even reportedly "jet pools" with Tesla CEO Elon Musk, and Google has an "electric car" section reserved in its parking lot (see picture at top by Tristan Nitot). It wouldn't be the first time Google co-invested with its founders; it followed Brin into his wife's 23AndMe.
Whether the Google honchos had their financial judgment clouded by the fact that they personally made it to the front of Tesla's fiercely competitive waiting list is something for Google shareholders to decide.
In so doing, they might consider another nugget buried in Tesla's S-1: The company has not yet stabilized its notoriously volatile executive ranks. Among the recent departures is general counsel Jonathan Sobel, formerly of Yahoo. Sobel started in September; he was gone by December. One tipster claims friction with Musk was to blame. The bigger question is whether Musk can forge more stable relationships with his co-workers going forward. Only time will tell. We'll be watching, and we bet Google will be, too.
(Top pic: A Tesla parked at Google headquarters, by Tristan Nitot. Second pic: Sergey Brin driving in his Tesla, by Zach Graves.)"

Google GOOG Below 250 USD intraday! Dow plus 500 points Rally, Gold at 800!

Time when the prediction was made that Google could deep below 250 in a severe Bear market valuation passed in our memory as so distant and happy that it is almost not worth mentioning. But the call was done and was right on the money.

http://sufiy.blogspot.com/2008/07/google-goog-bear-case-contunued.html

Other observations could come into life with recent developments. Announcement about the new Head of Treasury fired the rally in the market. Yesterday all hope was lost: VIX made break up, DOW has violated Bearish Flag downwards and US Dollar almost broke up to upside. Today was the different story and first Gold start to rally and overtake very important resistances on the way to 800. HUI, GDX and all Goldies have followed in unison with gains up to 31% in Barrick Gold ABX. Is it a turning point? Very much could be: in DOW we have a Bullish Engulfing Reversal candle pattern, last capitulation could exhaust the market pretty much and they should do something over the week end to fix the situation with CITIGroup C. The most important is that gold rallied even with still rising US Dollar and maybe our endless battle with gravity is over. Goldies in HUI and GDX have formed very strong reversal and never retest the lows in recent sell off it could be very strong positive divergence from the general market which is in play again. So we can forget charting miserable destiny of financials in the DOW and concentrate back on our Bull in Gold, Silver and Commodities ones investors will come back to their common senses.

With the new guy in charge in Treasury we can expect understanding of the currency question and that the strong dollar will kill economy in Deflation spiral. Weak US Dollar is the medicine from this meltdown.

Shorts will be served Fried next week particularly in Gold and Silver and their producers Shares.

SSRI, SLW, AUY, GDX, SST.v, TNR.v, CZX.v, OK.v, BVG.v

FEDs should consider to relaunch the banking system based on Google's Android.

Why not? Google's market cap is still bigger then all gold mining companies in HUI Gold Bugs Index. Company has the best banking motto "Do not be Evil". And its clicks are solid as gold or maybe even better. You click me your invoice I will click you back my payments click, click, click We all clicking will not be able to keep up with the FED printing money.

RIMM dissappoints and tanking, will Google GOOG be next to miss?

Bailout is like Prozac keeps everybody happy until you remember the reason: Economy is in a grave danger. Google particularly exposed:
1. Even before recent market blow off its growth rate was deteriorating. With Financial sector under water its revenue streams are definitely effected.
2. Multiple market cap to FCF is unsustainable in a Bear market and nobody even The President is not questioning it any more.
3. US Dollar rally takes it toll on non US revenue and it will be lower this Q.

Bear Case continued:

http://sufiy.blogspot.com/2008/07/google-goog-bear-case-contunued.html

Google GOOG is facing a legal challenge

Stock was under pressure yesterday in a rallying market, legal problems will not help its valuation which is already under constrain of falling multiple and slowing rate of growth. Another blow this quoter will come from strong USD when company will not be able to book a nice currency advantage from its international operations.

"Top Lawyer Is Selected As U.S. Mulls Google Suit

By JOHN R. WILKESeptember 9, 2008; Page B1
Washington -- The Justice Department has quietly hired one of the nation's best-known litigators, former Walt Disney Co. vice chairman Sanford Litvack, for a possible antitrust challenge to Google Inc.'s growing power in advertising.
Mr. Litvack's hiring is the strongest signal yet that the U.S. is preparing to take court action against Google and its search-advertising deal with Yahoo Inc. The two companies combined would account for more than 80% of U.S. online-search ads.
Google shares tumbled 5.5%, or $24.30, to $419.95 in 4 p.m. trading on the Nasdaq Stock Market, while Yahoo shares were up 18 cents to $18.26.
For weeks, U.S. lawyers have been deposing witnesses and issuing subpoenas for documents to support a challenge to the deal, lawyers close to the review said. Such efforts don't always mean a case will be brought, however."

Google GOOG bear case continued.

The last pillar of palace full with memories and sweet dreams about forgone Bull market is shaking: Google is firmly on track of our bearish scenario with further slowing growth, flat FCF and contracting multiple. We have wrote before http://sufiy.blogspot.com/2008/04/google-goog-has-deliveredanother.html about recent trends and now they are finally manifested in crashing stock price.

Trust is shaken and company is not immune to slowdown - sell off will continue and will surprise a lot of people with its magnitude: fear is much stronger feeling then greed. Our diagnoses is that company is at its peak in market share, biggest foreign market in UK is saturated and economy is in downswing there as well, it is still one trick pony and is feeling the hit of slowdown in economy. Financials were hit first, next is consumers, the advertising budgets are cut: first print media, TV; then web based as well.

On our bearish financial front signs of further deterioration are all over the recent report: Revenue Growth Q/Q has slowed -50% from 6% to 3%, Y/Y has slowed -33% from 58% to 39%. The same rate of decreasing rate of growth as in Q1 2008.
EPS growth was -5% Q/Q and 33% Y/Y. Yearly growth is still impressive, but nothing out of the ordinary in order to support bubble valuation in recession environment. Capex has decreased to 697,5 mil -17% Q/Q YouTube blades add broadband must be eating hard into the company's margin and it is desperate to cut it in order to save FCF. Cash Flow from operations was flat Q/Q. With a lot of spin around two closed offices are indication of drastic financial measures: boom is over.

Free Cash Flow in Q2 is 1068.6 plus 14% (in the Q1 FCF was 842 mil - here was a typo FCF was 937.8 mil). Company can play with TAC figures and reduce CAPEX further in order to deliver at least 4 bil FCF in 2008. But what will it tell us with further slowing growth rate in revenue? It means that company has hit a wall in its YouTube monetisation efforts and will start reduce even existing bleak expectation about break through on that front. Double Click purchase is dilutive to the rate of growth as well: display advertising will be cut first before click based.

With our prerecession multiple at 30 we will arrive to 120 billion market cap for Google which translates into USD377 target price.

Problem is that market is punishing the yesterday winner very brutally after missing its always overoptimistic expectations. I will put a crazy and heretic for a lot of bubble vision guests assumption that we will see in this bear market FCF multiple of 20 and Google's market cap at 80 bil (please put it in economic context guys: it is still Internet Advertisement Company, not water, bread or oil).

This valuation will translate into USD250 share price.

Google GOOG YouTube will continue to be a money drain.

News are old, but with a new meaning in the recession times: Google can not monetise its 1.65 billion investment, revenues are not material (200mil for 2008 is estimated) and it is officially a money drain from other profitable business. When you consider running costs for all those blades and bandwidth eaten by huge video traffic the picture will become even more bleak.

From: Google: We Can't Figure Out How To Make Money On Web Video, Either

"Of course, one other obvious solution to YouTube's sales woes would be to simply start advertising on YouTube pages, period. Nearly any page you see on the site today is ad-free. But Google is showing a billion clips a day. Why not simply start loading some of those pages with AdSense units?
Because of the other big admission in the WSJ story -- Google is afraid to sell ads on 96% of its inventory:
Fearful of fueling allegations that it is profiting from copyright infringement, Google will only sell ads against YouTube clips that have been posted or approved by media companies and other partners -- roughly 4% of the total, says one person familiar with the matter.
The story ascribes Google's fears to the billion-dollar Viacom suit, but we think that's not fair: Even if Philippe Dauman ends up settling with Google, it's not going to resolve the copyright cloud hovering over YouTube. So either Google's going to need a legal ruling that gives it the go-ahead to make money on its copyright-violating inventory -- or it's going to have live with diminished expectations for its $1.65 billion business."

Google GOOG has Delivered...another shorting opportunity

Few thoughts on earnings which were "missed" by main stream media:

Google has "blown up" earnings at 4.84 and meet revenue estimates at 5.2 bil. If somebody thinks that stock will go back to October Highs - think twice: company has beat only reduced estimates, just 90 days ago EPS was expected at 4.87.

On our bearish front signs of further deterioration are all over the recent financial report:
Revenue Growth Q/Q has slowed -50% from 14% to 7%, Y/Y has slowed -33% from 63% to 42%.

EPS growth was 8.7% Q/Q and 30% Y/Y. Yearly growth is still impressive, but nothing out of the ordinary in order to support bubble valuation. Lets have a look how this level of EPS growth has been achieved. Here is the surprise - welcome to the new reality: gravity still matters even in cyberspace. Capex has increased to 841.6 mil +24% Q/Q YouTube blades add broadband must be eating hard into the company's margin. Cash Flow from operations has increased only 5% Q/Q.

Our famous metrics of Free Cash Flow multiple is not leaving a lot of place for unwarranted happiness: in the Q1 FCF was 842 mil.

Now market will decide what is Google: a new technological frontier changing universe and "this time is different" or it is still an advertising company with technology edge in its model? Its customers and consumers must be living in virtual world and not facing stagflation: rising prices due to intentionally loose monetary policy and recession in real inflation adjusted output. The most encouraging for this point is Eric's "...Eric reiterated the company has not seen any macro-economic impact." It is still to come...he needs some help to see his dramatically slowing growth and FCF.

If company will be able to deliver FCF with 5% Q/Q growth for this year and CAPEX will stay at Q1 level FCF will be 4.2 bil. At 30 FCF multiple (our next stop in bearish slide compression) stock should reach Market Cap of 126 bil which will translate into USD397. Any change of heart of devoted shareholders or unfolding another bear leg in general markets and USD350will be seen as blue sky.

The higher stock goes into this bear market rally the safer will be PUT position. Apply all CS rules as usual.

Do not be stubborn (for myself) investor's enthusiasm (stupidity in some languages) should not be underestimated: wait for Technical signal Sell.

All these thoughts are for educational purposes and my own amusement only as usual.

Google GOOG into the earnings, strategy update.

Google has reached first projected target of downside at 430 based on Free Cash Flow valuation. Now my estimations are that this bear market rally will be sold off, Google will show further deterioration in revenue and earnings growth and with mounting evidence that the company is not immune to other mortals' slow down in economy, Google's stock will take its way to next down target of USD360. If we see Free Cash Flow deterioration from my previous estimates stock will collapse below 350 in a matter of weeks.

Action now is on Capital preservation, reduction of leverage and accumulation in resource sector. Downside protection is established by PUTs on GOOG - bubble deflating, INTC - rosy picture of "meeting" reduced guidance, SMH - Consumer hit hard, chip producers will take the hit, GM - finance mess/ consumer, AMR - oil/security mess, C - write downs, AMZN margin squeeze/consumer. All chart show high probability of another leg down in this bear market. Lundin mining is under capital preservation plan until Congo will be resolved: Calls taken on FCX, sold with profit. Calls taken on LMS, sold with profit. Core positions reduced. Put taken for downside protection. Calls will be bought if stock will go below CAD7.00 More effective capital allocation could be achieved in Junior mining sector which has been bitten into the dust. Trading around macro picture with falling dollar and accumulating in core sectors will be most effective according to my results. Stock picking in Juniors will be the must: management, properties, ability to finance exploration and development. Sector will be ignited with junior acquisition by one of the majors, but do not forget to be solvent by that time. Profit is the profit and if in any doubt - stay on the line, nobody get bankrupt from a good night sleep.

Google GOOG company is "addressing click fraud concern" - market is "addressing related valuation"

Google's customers are all linked to consumers, who are losing their purchasing power by the hour in recent recession. ROI on advertising is falling, Google's customers are cutting ADs spending, debt financed prosperity has lifted all boats and Google's ad campaigns looked like justified before, but now results are not so apparent: customers do not have money or maybe Google was never so effective to attract them after all?


"...speaking at the Bear Stearns Media Conference in Florida, Tim Armstrong, Google's president of North America advertising and commerce, said that the recent slowing in paid clicks "was intentional on our part" and will result in "a long-term benefit for our business."
That's because recent quality initiatives at the company have resulted in fewer unintentional clicks and a higher number of "conversions," or revenue generated by intentional clicks, according to Armstrong.
"Conversions actually go up for advertisers, which is positive, but there are less clicks overall," he said."

http://www.marketwatch.com/news/story/google-execs-address-decrease-paid/story.aspx?guid=%7BC4C2D4C2%2D6453%2D41F3%2DA9A3%2D118EE4A0CC47%7D&siteid=yhoof

Google GOOG first stop pit is reached at USD435

Multiples compression has brought stock price of Google to the first stop pit at USD435. Now recession fears will make its way in compressing it further to USD326:

"Finally great company has missed even greater expectations, more analyses will come later, but for now it is apparent that all financials have deteriorated further: growth rate sliped at fastest pase ever. FCF in last year was 3.4 bil USD. Multiple at closing at USD564 FCF/MC (176.5 bil) was 51.9, compared to yahoo around 20. Recession will eat hard into Google revenue growth, CAPEX will hurt FCF further in 2008. Multiple of 50 Free Cash Flow to Market Cap is not sustainable any more, expect first stop at 40. It is 40*3.4=136 bil market cap, stock price USD435. With further recession fears multiple of 30 will come into play (50% over Yahoo!). It will reflect in stock price of USD326. On the Technical side stock has broken crucial uptred line on weekly bases. Technical signal SELL which has been reported here 2 weeks ago now confirmed by fundamentals."

http://sufiy.blogspot.com/2008/02/google-goog-web20-bubble-is-bursting.html

Henry Blodget is on the same page with that analysis here:

http://www.alleyinsider.com/2008/3/_google_to__350_

Google Disaster GOOG : Comscore Reports Awful January

Henry Blodget February 26, 2008 7:16 AM
Comscore reported shockingly bad US paid click performance for Google in January: flat growth year-over-year versus a 25% increase in Q4. Even if Comscore is only half right, this is a disaster.
Flash note from analyst Bob Peck at Bear Stearns:
comScore reported 532mn domestic paid clicks in Jan. 08, flat YoY, but down 12% sequentially (Jan. 08 vs. Oct. Oct. 07). The click through rate was the lowest since comScore stated reporting this data and was down 200bp from levels in 4Q and down 400bps from levels in 1Q of last year. While this is one data point for domestic google.com only and from one source, which may or may not be accurate, it is a concerning data point and somewhat reflects what we have heard from SEMs - that they were not seeing a high volume of clicks from consumers possibly due to the economic slowdown.Note that Google reported a 30% YoY growth rate in overall (global) paid leads in 4Q07 and comScore reported growth of 25% YoY for domestic google.com paid leads for 4Q. While not an apples-to-apples comparison, we will continue to monitor the comScore numbers for Feb and Mar before definitive conclusions can be drawn.
This report is so shocking it bears repeating: ComScore said Google's US revenue units (paid clicks) grew 25% last quarter--a quarter that disappointed Wall Street. In January, the same source, ComScore, says the same revenue units were flat.
What could be the explanation for this? Strapped shoppers not clicking on as many links. This is exactly why one insider argued last week that Google is very exposed to economic weakness--and why we have been concerned for six months that Google was not "immune" to a recession.
Yes, Comscore could be wrong, and, yes, it's only one data point. But hard to imagine how the bulls are going to spin this one.

http://www.alleyinsider.com/2008/2/2008/2/google_disaster__comscore_reports_awful_january

Google GOOG vs Commodities, Virtual vs Real

Shift to the real assets will continue further, once growth rate will slow even further compression of multiples will bring GOOG price further down to sustainable valuation:

http://sufiy.blogspot.com/2008/02/google-goog-web20-bubble-is-bursting.html

I could not agree more with this analyses:

http://www.alleyinsider.com/2008/2/google_very_exposed_to_us_recession__expert

Microsoft offers to buy Yahoo in $44.6 bln deal

Google now will be under pressure from this side as well. Multiple for Yahoo! in this aquisition is around 30 compared to Google's 51 as of yestoday close.

Google GOOG WEB2.0 Bubble is Bursting

Finally great company has missed even greater expectations, more analyses will come later, but for now it is apparent that all financials deteriorated further: growth rate sliped at fastest pase ever. FCF in last year was 3.4 bil USD. Multiple at closing at USD564 FCF/MC (176.5 bil) was 51.9, compared to yahoo around 20. Recession will eat hard into Google revenue growth, CAPEX will hurt FCF further in 2008. Multiple of 50 Free Cash Flow to Market Cap is not sustainable any more, expect first stop at 40. It is 40*3.4=136 bil market cap, stock price USD435. With further recession fears multiple of 30 will come into play (50% over Yahoo!). It will reflect in stock price of USD326. On the Technical side stock has broken crucial uptred line on weekle bases. Technacal signal SELL which has been reported here 2 weeks ago now confirmed buy fundamentals.

http://investor.google.com/fin_data.html

http://investor.google.com/releases/2007Q4.html

http://www.alleyinsider.com/2008/01/live-analysis-google-q4-earnings-release-goog.html

Google GOOG Early Warning Bearish Trend Reversal

Google GOOG ...I know, I know - "this time it is different".

This is still a barometer of Investment Madness in WEB 2.0 bubble to watch. Untill this stock corrects to its "more reasonable level" of 30-40 FCF we will be still in a bubble state. Unhealthy expectations of next 20% upside with potential 50% downside are driven by liquidity, but it is quickly drying out...

The last time Warren Buffet sad in China: Google is great company and its easy to see it, but valuation is different: at 200 billion MC (it was before recent run) just to deliver 14% p.a. return to shareholders it needs to reach valuation of 400 billion in five years.

I have run the numbers again with GOOG at 694USD its market cap was 217 bil. Now MC/FCF=74.8! CAPEX has decreased from 597 to 553 mil in 2007 Q3 from Q1. Assuming at least the same CAPEX (hitting competition, Video - new storage blades ets.) FCF margin is 25.6%. In order to reach "normal valuation to MC/FCF=30") with return of 15% p.a. in five years time FCF must be 14.6 bil! and Revenue 57 bil! It means 30% growth year over year without any CAPEX growth extension. Google will reach MC of 437 bil in this case. Is it possible with economy marching into recession? I do not think so, but even if you are optimist here it is 15% per year with all risks of downside of one trick pony business and hitting competition. To give the idea of "normal MC/FCF valuation" Royal Gold RGLD will need to double overnight just to get there.

Google GOOG Earnings: Growth rate slowed further Valuation is Insane.

Google managed again to get amusement of the crowd by beating expectations, but the truth is that from now on the higher it goes the harder will it fall.

Growth rate slowed further to 57% Y/Y from 58% in Q2, and 63% Q1. Licencing and other revenue is still miserable 1%. Company has only one revenue stream and continue to be "a one trick pony". International revenue brought 48% and Google nicely profited from falling USD:

"International Revenues - Revenues from outside of the United States totaled $2.03 billion, representing 48% of total revenues in the third quarter of 2007, compared to 44% in the third quarter of 2006 and 48% in the second quarter of 2007. Had foreign exchange rates remained constant from the second quarter of 2007 through the third quarter of 2007, our revenues in the third quarter of 2007 would have been $24 million lower. Had foreign exchange rates remained constant from the third quarter of 2006 through the third quarter of 2007, our revenues in the third quarter of 2007 would have been $121 million lower."

Net Income margin is slightly higher at 25% of Revenue vs 24% in Q2 and lower then 27% in Q1.

Google managed to increase its Free Cash Flow to 1.1 billion USD from 0.7 billion in Q2, but it was "spiced" by reduced CAPEX to 0.55 billion from 0.58 in Q2 and 0.6 in Q3.

Revenue per Head has declined to 266 000 USD from 281000 in Q2.

It could be all very good news on solid company performance, but if you look at valuation at 640 stock is valued at ... 70 times Free Cash Flow (trailing). What is "normal"? - just 30-40 according to "value" analyst Henry Blodget. Even if Google will be granted 40 ratio for its market leader status its share price should be at around ... USD 367.

With all risks related to recession and ongoing competition Google's new target price at 800 by 2008 year end is "only modest" 23% increase from USD650.

Should the stock continue to rise on recent hype over USD650 it will be in parabolic move and I will build my put positions again.

Until Google corrects to "conservative" levels of valuation, market bubble will be growing and its burst after housing crash will be remembered for years.

More on Earnings to follow.