Financial Analysis of Google

8430 Words Mar 8th, 2011 34 Pages
GOOGLE

Financial Analysis Report

Prepared for:
Financial Management Class –
Florida Institute of Technology

February 2011

TABLE OF CONTENTS

EXECUTIVE SUMMARY 3

COMPANY INTRODUCTION 4

FINANCIAL ANALYSIS 5

Summary Financial Analysis Report 6

WEIGHTED AVERAGE COST OF CAPITAL (WACC) 10

FUTURE CASH FLOWS 12

ANALYSIS OF CASH FLOWS 13

Sensitivity Analysis of Google’s 2011 Future Cash Flow 14

Sensitivity Graph for Google’s 2011 Future Cash Flow 15

Sensitivity Graph for Google’s 2011 Future Cash Flow 15

Inflation Analysis 15

Google Inc. Discounting Future Cash Flows for Inflation @ 1.7%: 16 Footnotes effect on future cash flows 17

Analysis of Google Competitors 19

ANALYSIS OF CASH
…show more content…
Furthermore, because Google’s employees d are also equity holders, morale is high and Google encourages its employees to feel a part of Google’s success.

In conclusion, Google is a sound investment that according to the analysis will continue to increase their profits and their dominance in the marketplace.

COMPANY INTRODUCTION

In 1998, Stanford University graduates Larry Page and Sergey Brin combined their ingenuity and built a search engine called “BackRub” that evolved into what is now known as Google. Google, with over 150 domains, now functions as a search engine that offers many different products and services including web applications, advertising, sports scores, stock quotes, headlines, addresses, videos, etc. Google’s focus is “to provide useful and relevant information to the millions of people around the world as they rely on us (Google) to provide the answers they are seeking.”

The strategy of focusing on getting information to millions of people internationally is the foundation of Google. Another strategy in which Google is unique is their culture. Google creates an atmosphere of creativity, teamwork and brainstorming which has helped win them a spot in the top 10 of Fortune magazine’s best companies in which to work.

Google offers services such as search advertising, display advertising, mobile advertising, tools for publishers,

More about Financial Analysis of Google

Open Document