Cramer Goes Inside Google’s Monster Market Cap
Should you care that Google’s market capitalization just passed that of Microsoft ?
It may seem more like an exercise in mathematics more than anything else, but Jim Cramer said the milestone can not be ignored.
“First, let me say that writing off Microsoft could be a brutal and needless mistake. The company, with about a 3% yield, a terrific cash hoard and an amazing installed base, has too much going for it to ignore. “
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However, the Mad Money host doesn’t think that’s enough to generate excitement either.
“The problem with Microsoft,” he said, “is that the company suffers from something that’s just deadly when it comes to the demographic it must own if it is to break out of the p.c. ghetto. It’s not cool!”
Don’t believe it. Go talk to your kids. Talk to people at college.
“I have NEVER EVER heard a kid say, “I am stuck with this Apple and I want a Microsoft operating system.” I have never heard anyone say “I am so glad for the new Window’s product cycle, it is so exciting, I am junking my Mac.”
In other words, Steve Ballmer and before him, Bill Gates, are viewed as suits by the younger people. Meanwhile Google is cool, like Apple.
“It’s got style, it’s got pizazz. It is loved,” said Cramer.
And for investors, “it is distinctly a mobile company that does better on your handset than on desktop.”
Now back to the main question - the disparity in market caps?
“It is simply the financial equivalent of a judgment over who’s cool, “ Cramer said. “Google is; Microsoft isn’t. And the gulf is growing, not shrinking, which is why Google, even up here, is the one to own.”
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