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Finally, we've got
Google(GOOG). Google carries more than $44 billion in cash and investments, offset by a $6.2 billion debt load. That number has continued to swell in spite of a large number of pricey acquisitions -- Google's paid search portal just happens to be lucrative enough to give management the ability to write checks with impunity. The Mountain View, Calif.-based firm owns its namesake search site in addition to properties such as YouTube, Gmail and Motorola Mobility.
Google's foothold in the search business is impressive. The firm owns more than 60% of the fragmented market, dwarfing rivals who are trying to take share from the firm. Google's scale affords it the ability to dump money into other projects. Sometimes, the results are positive -- Gmail and Google Maps are examples. Other times, they're less positive. I'd argue that the firm overpaid for Motorola Mobility, an investment that's going to take some time to pan out.
Hopefully, the challenges of generating meaningful returns on investment are sending a signal to management; it makes more sense to return value to shareholders through other means (at least in part). Google may be the next mammoth stock in Silicon Valley to initiate a dividend payout.
To see these value-centric names in action, check out the
Cash Rich Buys Fall 2012 portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.
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