UBS took the ax to two of the Internet’s leading names on Friday, saying their shares had become fully valued.
Google fell 8.3% to $169.35 after UBS initiated coverage of the recent IPO with a Reduce rating and $160 price target. Shares of Google have fallen 15% since the stock failed to take out the $200 level earlier this week.
Analyst Benjamin Schachter predicted that Google will grow more slowly in 2005 and margins will deteriorate, leading to a lower valuation, and new shares coming out of lockup will also pressure the stock. He said Google is also potentially “on a collision course with Microsoft” .
“We consider Google a great company, but believe investors will see better entry points in the future,” Schachter wrote.
Schachter was somewhat kinder to Yahoo, rating the company Neutral with a $37 price target. Yahoo shares lost 3.5% to 36.35.
The broader market rose Friday on news that jobs grew at the strongest rate in seven months in October.
The Nasdaq gained 15 to 2038, the S&P 500 rose 4 to 1166, and the Dow climbed 72 to 10,314. Volume declined to 1.73 billion shares on the NYSE, but rose to 1.91 billion on the Nasdaq. Decliners held a slight edge on the NYSE, while advancers 18-12 on the Nasdaq. Upside volume was 65% on the NYSE, and 72% on the Nasdaq. New highs-new lows were 461-7 on the NYSE, and 223-25 on the Nasdaq.
Nvidia , ValueClick
, Wireless Facilities
and Bsquare
surged on their results.
WebMD , Loudeye
, eSpeed
, Cray
, 24/7
, Conexant
and OpenTV
fell on their results.
Research In Motion tumbled 12% on patent concerns.
Macrovision fell 5% on a report that the Shrek 2 DVD didn’t use the company’s protection technology.
