Google reports earnings after the bell today. Wall Street expects a small beat. The Estimize whisper number expects a small miss. Estimize is a network of financial bloggers whose predictions often been those of Wall Street analysts, who tend to be too optimistic for various institutional reasons. On Apple, Estimize has pretty consistently nailed the earnings beats, while Wall Street has been too pessimistic on that one.
In honor of the upcoming earnings report, I updated my Google discounted cash flow analysis, which I have not done since November 2011. Interestingly, while Google missed on earnings last quarter, its free cash flow for 2011 ultimately experienced huge growth. Here is my blog post on my blog, The Dumb Money. Here is a direct link to the spreadsheet on Google Docs.
Note that really my buy at $620 is a really, really rough estimate. I suspect the true buy range is somewhere between $600 and $670 per share. I never buy stock before earnings come out though, making me the opposite of most people. Why would I? As a long-term holder, why on earth would I want to buy stock before the most recent knowledge about the company is available? Does it mean I might miss a $10 move in the stock? Maybe. But $10? In the grand scheme, I'd rather have the additional clarity and certainty.