Google: Full of Surprises

Tyler is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

Technology has affected society in a lot of ways. Some of the ways have been detrimental, and some have not. When people do research, most people don't go to the library, look in newspapers, or other tangible book sources - some don't even ask friends and family. Almost everyone goes directly to their computer. More specifically, they normally go to Google (NASDAQ: GOOG). What this means is this, people trust the information on Google. So let’s discuss the most searched companies on Google, and some that surprisingly weren't as researched. 

Every year the Zeitgeist Report shows the most googled stocks of 2012. However, before we get to those businesses, what did Google do in 2012? Google's revenue increased 12% from December 2011 until December 2012. Not surprisingly, the majority of Google's revenue is derived through search adds - 50.3%. So, what stocks do we expect to have been googled the most and what surprises were there?

The expected results:

One of the most talked about companies of the year was Facebook (NASDAQ: FB). Not surprisingly, it was googled more than any other company this year. Facebook went public in 2012, and was met with unrealistic expectations. Immediately, Facebook's stock price plummeted, and never really recovered. The stock has dropped over 28% from its IPO. With the high expectations and underwhelming results, it’s no wonder it was the most googled in 2012. 

Facebook generates nearly all of its revenues from text/display ads and transactions on virtual goods. While its revenues from text/display ads are expected to drop slightly next year by 2.5%, Facebook's overall revenue is expected to increase by 32% as seen here. Transactions on virtual goods are also expected to increase by 1.3%.  However, there are also reasons to be skeptical about investing in Facebook. 

If regulators prevent Facebook from tracking its users, this could detract the value from its advertising platform. Advertising isn't always a good thing for a company though. Excessive advertising and privacy fears could also potentially cause users to abandon Facebook entirely. 

The Surprises:

Facebook’s prominent spot on Google was not a surprise, but there were two companies that did not even break the top ten list. They seem to have received a very heavy dose of media and other attention, yet they weren't as popular on Google.

With all of the expectations, news, and new products; Apple (NASDAQ: AAPL) wasn't one of the most googled stocks in 2012. Apple released the new iPhone 5 in China on Friday and earlier this year in the U.S. With all the media attention relating to the flop of iPhone's "Maps," and Google's success with theirs, a lot of people would have expected Apple to be searched more. Due to the debacle with "Maps," Apple lost credibility with some of its customers. For more information on how the iPhone has affected Apple, click here.

Another surprise is Amazon, (NASDAQ: AMZN) which everyone seems to be talking about. Amazon is forcing other businesses to change their operations in order to compete. As a result, Amazon continues to surge as it has gained 38% this past year. People are flocking to Amazon's style of business. They allow you to shop at what are often discounted prices, with a larger variety of products and from the convenience of your own home. Can it get any better than this?

The Bottom Line...

Google has become the new way of research. Technology has become a company’s best friend, or a thorn in their side. People no longer have to go out of their way to research anything - they just do it from home. All of these companies have a chance to grow exponentially, but they also face risks that could cause a downfall. It will be interesting to see what effects Google has on these other companies. If the Zeitgeist Report shows us anything, it is to expect the unexpected. Always remember, Google is full of surprises. 

 


tlwofford has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple, Amazon.com, Facebook, and Google and has the following options: long JAN 2014 $20.00 calls on Facebook. Motley Fool newsletter services recommend Apple, Amazon.com, Facebook, and Google. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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