Did Someone Suddenly Wake Up Today And Decide That GOOG Is Expensive?

I surely think so -- currently trading down $18 at around $405. I have insisted for some time now that, while this truly may be a great company, its stock has gotten quite a bit ahead of itself. It was trading a bit over $430 the other day (after I had called, for like the 3rd time in a week, for people to lighten up/short it @ $424), and I was thinking to myself "Am I the only fool who reckons this stock is overpriced here?" Apparently not anymore. Which does not of course mean that those of us who think that GOOG is overpriced are suddenly not fools. For all we know, we might wake up tomorrow morning and see the stock trade with the 5-handle in front of it. But hey, it's called a market, and that's why it serves healthy doses of humble pie to anyone and everyone who thinks they know it all.

Still, as Warren Buffett once said, it's pretty dangerous for a company to claim 15% year-on-year growth for a long time -- unless the economy itself is growing at 15% (which it ain't), that bold statement eventually catches up with you (and, I would add, makes...er... ketchup out of you -- forgive me, please, the cheesy pun). So, a couple of downgrades and a few insider sales later, it would seem that GOOG is destined to trade under $400 before long -- which, by the way, still doesn't make it "cheap". If it falls to under $300 any time soon, given its current financial metrics, call me -- then we are talking!

On a side note, my MWD-GS spread continues to do well (11.5% in the money so far after a little more than 3 weeks since I suggested it), and maybe after another 4-5% of MWD outperformance, I would be tempted to trim that position by a 1/3rd or so, and then leave the rest in peace for the 2006 calendar year. MWD has some catching up to do -- "The Mack is Back and Is Even More Wack", say some insiders.