S&P downgrades Google rating
- By He Shan
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China.org.cn, August 17, 2011
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US rating agency Standard & Poor cut rating of Google stock from "buy" to "sell" Tuesday, following the deal inked between the search giant and Motorola Mobility. [CFP] |
U.S. credit-rating agency Standard & Poor's downgraded its assessment of Google stock from "buy" to "sell" Tuesday after the search giant announced Monday it will spend US$12.5 billion to buy Motorola Mobility.
S&P said the decision to buy Motorola Mobility will put Google at risk. At the same time, it lowered its target price for Google stock US$200 to US$500.
The acquisition will help Google gain access to more than 17,000 patents, but is not enough to protect Android from patent infringement lawsuits filed by its rivals, the rating agency said.
S&P said the purchase will harm Google's growth, profitability and balance sheet.
Google shares lost US$18.23, or 3.3 percent, on Tuesday to close at US$539.
