Google’s antitrust trial will generate plenty of headlines in the weeks ahead, but Paul Glenchur says the case won’t carry the ramifications mainstream news would like you to believe.
The Department of Justice alleges Google has built a monopoly by paying to be the default search engine on iPhone and web browsers.
“The risk for investors to think about is if those payments would go away,” Hedgeye’s Telecom Media and Legal analyst explains in this clip from The Call @ Hedgeye. “We’ll never get a public number on those payments. There are estimates it’s more than $10 billion—some have said as high as $20 billion. It’s 100% margin, so it has an impact on gross and net margins for the company, but it’s not the antitrust case of the century.”
Keith McCullough’s bullish signal on GOOGL remains unchanged. Since moving from neutral to bullish on July 25, the stock is up 10%.
“I don’t think there’s any massive breakup or anything coming here about divesting Chrome,” Glenchur adds. “Chrome wasn’t even mentioned yesterday during the opening arguments. This case is basically about payments.”
Watch the full clip above.
