Larry Page steps down as CEO of Alphabet, Sundar Pichai to take over


Eight. Melissa Larry Page stepping down as alphabet. CEO Sundar Pichai become CEO of both Google and alphabet in terms of the day to day. Unlikely to see major changes. Which is why you may not be seeing a lot of change in alphabet so that stock after hours now under the Google umbrella remember Pichai ran the establish businesses advertising cloud android software devices and he has been NCO since August of two thousand fifteen and since then alphabet sock has certainly sword relative to the broader markets but it has underperformed? It's big cap tech peers. Here's now since the company's financial restructuring remember split from into alphabet and Google alphabet became the place where the company's moon shop projects objects have lived. That includes waymo driving cars to drones Internet balloons and it's healthcare projects so perhaps guys the question now is what happens to those. Money losing initiatives will we see more financial disciplined under Chai and CFO. Ruth poor at who comes from Wall Street and has been known for more financial disciplined as page steps down. And does he also step away from those moon shots as well. That division again loses a lot of money and those traditional businesses like advertising pay for them. Melissa our ideas your thank you your Bosa been treating over this news up when it broke. I don't know half an hour ago or so. Karen what do you what do you make of this. I well I think it. It shouldn't be a huge change. I mean this is a very big my largest position actually. I've not really concerned about this. I do think due to talked about maybe more financial all of discipline I think we started to see this when they brought in report which already goes back for years and then we wanted to see more clarity and so they they they split into two and then we actually wanted to see a little movement on the balance sheet and they addressed it they could have done a lot more but they start to address it so I think they're doing all the right things just shows how important having a good succession plan is. There's still get to something like Tesla you think What is the succession plan? But I think they've done a very good job as investor. I feel like this is going to be not very much of a change. I think five years ago seven years ago. I think this is a much bigger deal. I think it's actually on the margin positive thing I think. Sometimes you need need a fresh set of eyes to current point report came in this stock. Thirteen fourteen fifteen stock meandered for long time. She came in. I think the stock was either side of six hundred dollars ars. It's never looked back for all. The reasons cited financial fiscal responsibility. And I think a new set of eyes is probably good thing them walking away. I don't think it's negative. I think of anything that's positive. Seventeen percent EPS growth traits twenty three times. Forward earnings seeming. Listen I know. It's not a blockbuster overstock but you look at it. Slow and steady wins the race for Google and I think we were with a whisper of all time highs. We actually might be making all time highs. We speak caresource. You're a couple of great points on twitter as she normally does on that Pichai was already in charge of Google Youtube for some time That page and brain have been sort of a wall with their own interests and they also still control the company. I mean to factor through through their stock. It's a dual class structure. So they still have control effectively. The company great points and it makes you wonder whether some of this has evolved out of the politics that the companies facing certainly there are headwinds on the regulatory side. There's enormous I tell. went to their core business and talked about that. I mean the control of costs whether it's through the tack costs or the cat backs. These are things that in. The last quarter of investors have become quite quite comfortable with what the company's been doing if anything that the secular businesses alive and well Google cloud is growing is going to be a major business. You worry about the regulatory maybe this is the guy you know. Maybe this guy to take them out of the limelight because they are the founders. They are the icons they are are. They are major major players in the politics of Silicon Valley. And what goes on beyond there and I think maybe this changes the tax a little bit and maybe this as the CEO position this opens up the opportunity to really go into a whole focus of where they really are because they are spending money in certain places. They're not everybody's always all that excited about so the reality is are they going to be spending more and putting more into you cloud. I think that is where they need to go. And I think they're moving in that direction I think they got the right. CEO and when you talk about financially fiscally their spending habits and everything. That's something. I think that much ruth might be able to step up now and really put in more dividend. Well Yeah it all this talk about free cash flow with just about every big company that we talk about on this desk all the time. And what are they doing with that and obviously a lot of acquisitions over time I'm all that type of thing but yes something like that Mel which I think would make a lot of sense. Look at how well that's worked for the apples of the world Microsoft's of the world forever. I mean that's something they should do. I have a question Russian now that are we going to many questions at many points in time. One particular question at this moment in time and that would be are we gonNA look back at this change angel leadership and think this was to alphabet what Saltine Adela was to Microsoft. I I don't think so why I I don't think Google needs to do what Microsoft needed to do and again there was already some momentum behind that change it Microsoft but Microsoft move to the public cloud everything that they've done to compete but maybe wrestles some of this away from Amazon and Google. I think has been well On. Its Way as we've all talked about towards this transformation it seems like it but I don't think it's the same thing I don't don't think so either because of the fact where has he come from versus where Saatchi and Adela was at Microsoft. And let's not forget. Google is a fine company alphabet to find company. Microsoft soft was not and they needed somebody that's going to transform from where they were to where they are now they hired the right guy. I think this gentleman now can step in there. He and report together can build this into a much bigger company and a lot of ways focused on cloud but that won't be the only focus they still have all these other areas all these other verticals that they bring in money Thinking the regulatory weight off the back of the company. I mean really unleash some bill that would be great. I don't think you're GONNA get for a while. I think to your point that those those two could potentially Them stepping back could ease things a little bit. Every they didn't show up. They chose not to go to Congress. I see if you know now. Now that it's up to them whether or not they would send someone but I mean. Just look at the France you know what started our tariff tax write was the digital digital tax here. So it's not a lot of clarity for a while. That's why the stock isn't higher. It's a piece point I wanNA say. It was flattering Microsoft. There wasn't doing particularly early. Well I mean it was sorta treading water with the broader market. He walks into stock. Is probably you know better than I. The stock is probably more than doubled under his leadership which is pretty significant if we have a conversation about. IBM Six months. We're GONNA have that same conversation if this is a watershed moment but with that said Piper Jaffray just in the shade today. Fifteen hundred dollars price target as did city city. Fifteen hundred dollars price target. You know I think on the margins. This is a positive thing. The regulatory aspects these two guys stepping down I think if nothing else probably alleviates Some of the pressure. Not all of it so I think if you're looking for reason if you need one more reason to buy the stock I think this is good

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