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Will Google be the next to fall?

Google Stock Analysis

Apple’s (AAPL) tremendous tumble after the stock hit an all-time high of $705.07 last September continues to be one of the biggest stories in tech. We know hedge funds led the charge, but investors continue to question the Cupertino-based company’s future after insisting it could do no wrong through much of 2012. Apple wasn’t the first company to learn how quickly sentiment can shift as its share price tumbled more than 30%, and it certainly won’t be the last. According to one industry watcher, Google (GOOG) might be next in line for a huge reality check.

Long-time markets reporter Jon Friedman penned a recent piece exploring the very real possibility that Google could be the next company to see its share price fall on shifting sentiment.

“Without question, Google has now reached a point in its maturation where its shareholders might need to to [sic] worry about what I call The Icarus Effect,” Friedman wrote in a DailyFinance column. “The relevant question is this: Is Google’s stock price flying too high now for its own good? Remember, how in the Greek fable, Icarus rose high but ultimately flew too close to the sun. After his wings melted, he fell into the sea.”

Friedman writes that Google’s management is widely respected and the company has shown stability in recent years, but a stock’s price can “sometimes can seem to operate on a level all its own.” He warns that while Google’s prospects in mobile remain attractive to investors for the time being, the tide can turn at any moment.

“We’ve all seen the great companies lose their way in the stock market, haven’t we?” Friedman wrote. “Mighty Apple has wobbled lately. We observed even omnipotent Microsoft (MSFT) become something of an after-thought by the growth-oriented investors. As shareholders of Apple and Microsoft (not to mention Intel (INTC), Cisco (CSCO) and so many others) can remind you, the stock market has no institutional memory and good luck if you’re expecting to get the benefit of the doubt, based on past accomplishments.”

Google shares closed at $799.78 on Wednesday and were trading above $803 during Thursday morning’s session.[bgr-post-bug]

Zach Epstein

Zach Epstein has been the Executive Editor at BGR for more than 10 years. He manages BGR’s editorial team and ensures that best practices are adhered to. He also oversees the Ecommerce team and directs the daily flow of all content.

Zach first joined BGR in 2007 as a Staff Writer covering business, technology, and entertainment. His work has been quoted by countless top news organizations, and he was recently named one of the world's top 10 “power mobile influencers” by Forbes. Prior to BGR, Zach worked as an executive in marketing and business development with two private telcos.