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Google Shares soar 61-fold from IPO price without splits!

Who doesn’t know about the Google search engine? We are very sure that people from every corner of the Earth have not only heard of but also used the famous and reliable search engine, Google. 

Yesterday, Google turned 25 years old and celebrated in a special way by displaying a special Google Doodle on its search engine.  

However, for stock market participants, it is only 19 years old as it was listed in the year 2004. In this article, we are going to explore how Google started and recap its IPO journey along with its stock splits. 

How Google Started: 

The genesis of Google traces back 25 years ago when doctoral students Sergey Brin and Larry Page crossed paths during their pursuit of Stanford University’s computer science program in the late 1990s. Recognizing a common vision, they were driven to improve access to the World Wide Web. Their relentless efforts from dorm rooms led to the development of a prototype for an advanced search engine.  

As their project gained momentum, they transitioned their base of operations to Google’s inaugural office, a rented garage. Consequently, Google Inc. was formally established on September 27, 1998. 

The mission has remained steadfast over time: organizing the world’s information and ensuring its universal accessibility and utility. Today, billions of people worldwide depend on Google for searching, connecting, working, playing, and more. 

IPO flashback: 

The company’s IPO came in the year 2004 during a volatile period on Wall Street. Leading up to the IPO, the Nasdaq Composite (COMP) had declined by 8.6% for the year, and the S&P 500 (SPX) had experienced a 1.5% loss. Ultimately, the market conditions couldn’t muster sufficient demand to sustain the initially proposed pricing. 

On August 19, 2004, the stock began trading at USD 100 (Pre-Split Price), marking an approximate 18% increase from the IPO price. It reached its lowest point that day at USD 96, a level it never revisited, and ultimately concluded the day’s trading session at USD 100.43.

Considering there were 271,219,643 shares outstanding after the initial public offering (IPO), the company’s market capitalization at its IPO price stood at USD 23.05 billion and the current market capitalization of the company stood approximately at USD 1.65 trillion. 

The latest closing price of Google’s class A stock is USD 130 per share as of September 27, 2023.

Stock Split: 

The Google stock has experienced two splits since its initial debut. Firstly, there was a 1:2 split that occurred on April 3, 2014. This effectively halved the stock’s price, reducing it from approximately USD 1,143 to around USD 572. 

Subsequently, a 1:2 split took effect on July 18, 2022, significantly lowering the price from above USD 2,235.60 to USD 111.78. 

If we exclude the impact of these splits, the stock would be trading at approximately USD 5,186, which is approximately 61 times the IPO price. 

On an adjusted basis before these splits, the stock’s all-time closing low would stand at USD 96, while the highest closing price would be USD 5,993.60, achieved on November 18, 2021.

Google Share Price
Google Share Price Performance

The stock has witnessed an impressive surge of 5,064% from its closing price on its inaugural day on Wall Street. To put this into context, during the same period, the Nasdaq Composite has risen by 617%, and the S&P 500 has experienced a gain of 291%. 

Undoubtedly, it has outperformed both indices by a significant margin, and its worldwide popularity makes it even more promising for the future. 

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