SecondShares’ Lou Kerner was on CNBC yesterday after he initiated Google with an ‘underperform,’ making him just the second analyst to put a ‘sell’ on the stock. Kerner put a price target on Google at just $525.
According to Kerner, Google is making the vast majority of its revenue on a pay-per-click basis to drive traffic to web sites”, and “given its huge base of over 500 million members, the majority of which log on every day, Facebook is already driving more traffic to some leading web sites and it is poised to dramatically grow its share of traffic generation just based on clicks from user news feeds.”
According to CNBC, Google shares are down 21 percent this year, underperforming competitor Yahoo, which is down 17 percent. Yahoo was downgraded to ‘hold’ today by BGC Financial analyst Colin Gillis, who cited flat display advertising in June.
Lou Kerner is a partner at SecondShares and an analyst at Wedbush Securities.