Blodget: A Google Bear Scenario

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Well, this ought to catch some folks attention, written by the fellow who called Amazon $400: I'm just laying out a scenario that could kneecap Google and take its stock back to, say, $100 a share. Google's major weakness is that it is almost entirely dependent on one, high-margin revenue stream. The company has dozens of cool products, but with the exception of AdWords, none of them generate meaningful revenue. From an intermediate-term financial perspective, therefore, they are irrelevant. So, the question is, what could happen to AdWords, and what will happen to the company (and stock) if it does?... ... let's say click fraud continues to increase as a percent of total clicks (which seems perfectly plausible to me). Eventually, all else being equal, ROIs will start to decrease, as the $1.00 keyword that delivers a profitable sale today will deliver an unprofitable one tomorrow....

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