Jan 13, 2010

Can The Nexus One Add $20 Billion To Google’s Market Value?




How much exactly is the Nexus One line of Android phones worth to Google? The folks at Trefis have modeled Nexus One sales into their financial forecast for Google and estimate that it will account for nearly $20 billion of Google's market cap (based on its target price pf $659 per share), accounting for 9.3 percent of the total. That is more than its estimated contribution of ad and search partnerships (5.1 percent), Google Apps (3.2 percent) or YouTube (2.4 percent). Only search ads account for more of Google's total value (68.1 percent).

How does Trefis come up with these numbers? Trefis is an investing site which comes up with financial models for stocks which translate into interactive stock charts and price targets. If you don't agree with their model, you can change some of the underlying assumption sin the drag-able charts and create your own model (see below). Trefis is assuming Google will sell 5 million Nexus One phones this year, and that the Nexus One market share will grow from 0.4 percent this year to 3.4 percent in 2016, when the iPhone will have an 11.5 percent global mobile phone market share (as shown by the olive-colored line above) and Blackberry will have an 8.2 percent share (green line).


How much exactly is the Nexus One line of Android phones worth to Google? The folks at Trefis have modeled Nexus One sales into their financial forecast for Google and estimate that it will account for nearly $20 billion of Google’s market cap (based on its target price pf $659 per share), accounting for 9.3 percent of the total. That is more than its estimated contribution of ad and search partnerships (5.1 percent), Google Apps (3.2 percent) or YouTube (2.4 percent). Only search ads account for more of Google’s total value (68.1 percent).


How does Trefis come up with these numbers? Trefis is an investing site which comes up with financial models for stocks which translate into interactive stock charts and price targets. If you don’t agree with their model, you can change some of the underlying assumption sin the drag-able charts and create your own model (see below). Trefis is assuming Google will sell 5 million Nexus One phones this year, and that the Nexus One market share will grow from 0.4 percent this year to 3.4 percent in 2016, when the iPhone will have an 11.5 percent global mobile phone market share (as shown by the olive-colored line above) and Blackberry will have an 8.2 percent share (green line).