Microsoft Can’t Get No Respect

What good is $51.6 billion if you can’t spend it?

Microsoft has apparently been spurned in an attempt to acquire Google, according to this morning’s New York Times.

With $51.6 billion in cash as of Sept. 30, presumably Microsoft’s offer wasn’t a lowball one. But with talk that Google could be valued at $15-$25 billion in the hottest IPO since the dotcom bubble burst, it’s no wonder Google’s founders want to see what the IPO route brings.

Analysts estimate that Google will earn as much as $200-300 million this year on revenues of $700 million to $1 billion, so the company could be valued at 50-125 times earnings and 15-35 times sales. Since Yahoo trades at 120 times earnings and 20 times sales, the $15-$25 billion range seems quite attainable for Google.

Amazing we’re talking about valuations like that just a year after the longest bear market since the Great Depression.

Stocks were mixed Friday as investors continued to digest Thursday’s huge jump in GDP. Concern about lack of job creation in the third quarter was cited as a restraining factor, along with worries that some of the gains came from one-time events like tax cuts and mortgage refinancings.

The Nasdaq slipped fractionally to 1932, the S&P 500 rose 3 to 1050, and the Dow added 14 to 9801. Volume declined to 1.44 billion shares on the NYSE, and 1.81 billion on the Nasdaq. Advancers led 18-13 on the NYSE, while decliners led 16-15 on the Nasdaq. Upside volume was 54% on the NYSE, and 56% on the Nasdaq. New highs-new lows were 286-2 on the NYSE, and 296-9 on the Nasdaq.

Brightpoint , Wireless Facilities and S1 surged after beating estimates.

Sonic and Commerce One fell on their results.

Netopia soared 22% on an upgrade.

Cisco edged higher ahead of its earnings report next Wednesday.

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