This is an excellent post, thanks for your effort!
I had a question though based on the following lines:
"The fact that GOOGL had to buy Wiz (at a steep price) rather than being able to develop the same capacity in house suggest the company is not as entrepreneurial and innovative as it should be"
Google is not anywhere near the cybersecurity space. And if they dont want to spend their resources (all of them) on building their own cybersecurity infra, what exactly is the problem? It probably would have costed them more to make their in house cyber security system.
Acquiring a small competitor (valuation maybe justified) does make sense from my statement.
Perhaps they may not declare dividend this year in order to save cash, time will tell.
Thank you for your comment. It is a very remarkable company as my first note, which was very positive on the history of the company, indicates. However that is all in the past and founders and shareholders have been rewarded well for it. However, markets are forward looking and we need to look to the future. Wiz only started in 2020. Google surely should have been able to develop something similar at that time or earlier. Given that they did not ,they must have felt they had to catch by inorganic growth. They will integrate Wiz and add to the offering under Google Cloud Platform (GCP) and they will have a much wider reach than Wiz on its own . The stock valuation has come down a lot , more than most other Mag & stocks, which suggests markets has some concerns. I tried to outline some of these. It is a remarkable company and at some price/ valuation , it will be a compelling buy.
Hi Sir,
This is an excellent post, thanks for your effort!
I had a question though based on the following lines:
"The fact that GOOGL had to buy Wiz (at a steep price) rather than being able to develop the same capacity in house suggest the company is not as entrepreneurial and innovative as it should be"
Google is not anywhere near the cybersecurity space. And if they dont want to spend their resources (all of them) on building their own cybersecurity infra, what exactly is the problem? It probably would have costed them more to make their in house cyber security system.
Acquiring a small competitor (valuation maybe justified) does make sense from my statement.
Perhaps they may not declare dividend this year in order to save cash, time will tell.
Thank you for your comment. It is a very remarkable company as my first note, which was very positive on the history of the company, indicates. However that is all in the past and founders and shareholders have been rewarded well for it. However, markets are forward looking and we need to look to the future. Wiz only started in 2020. Google surely should have been able to develop something similar at that time or earlier. Given that they did not ,they must have felt they had to catch by inorganic growth. They will integrate Wiz and add to the offering under Google Cloud Platform (GCP) and they will have a much wider reach than Wiz on its own . The stock valuation has come down a lot , more than most other Mag & stocks, which suggests markets has some concerns. I tried to outline some of these. It is a remarkable company and at some price/ valuation , it will be a compelling buy.