GOOGL's total return

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football236
Posts: 11
Joined: Thu Jun 22, 2017 11:49 am

GOOGL's total return

Post by football236 » Mon May 21, 2018 10:24 am

Hi.

Take a look at Morningstar's total return for GOOGL (click here and scroll down to "Trailing Returns"). It states the 5-year TR is 12.43%, which I believe is wrong. Using these historical quotes, and ignoring the one-time dividend for simplicity, I calculate the TR should be 18.7% annualized over that 5-year period (((1069.64/454.72)^(1/5))-1):
5/20/13 $454.72
5/18/18 $1069.64

My guess is that Google's stock split from 3/27/14 is throwing off Morningstar's figure because their 3-year TR for GOOGL looks right, though I still don't get how they computed 12.43% for the 5-year TR.

Does my assessment seem correct? Also, where do you go to quickly and reliably get total returns, instead of having to download the historical data and calculate it yourself?

Thanks.

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Alexa9
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Joined: Tue Aug 30, 2016 9:41 am

Re: GOOGL's total return

Post by Alexa9 » Mon May 21, 2018 10:44 am

To check the math, I always plug in the reverse
454.72*1.187^5=1071.51
So your math looks good, but I doubt their website is off so maybe there is another variable missing here or they are calculating it differently.
Other than fact checking, why does it concern you?
I've used google finance, yahoo finance, portfoliovisualizer but I am no longer interested in following stocks due to using index funds.

setemupknockem
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Joined: Wed Feb 28, 2018 6:46 pm

Re: GOOGL's total return

Post by setemupknockem » Mon May 21, 2018 6:04 pm

GOOGL split into Class A and Class C stocks (GOOG) in April 2014. http://blogs.marketwatch.com/thetell/20 ... ock-split/

football236
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Joined: Thu Jun 22, 2017 11:49 am

Re: GOOGL's total return

Post by football236 » Tue May 22, 2018 9:43 am

Alexa9, thanks. I'm nearly entirely in index funds but own Google shares as well and wanted to compare the incremental return I received on my Google shares over the last five years compared to the S&P 500 as well as a potential property investment. I thought it would be a quick glance on Morningstar, but when the figured showed up as 12.43%, my gut told me that figure is wrong given the S&P 500's total return was similar for the same period, and I know GOOGL outperformed the S&P 500.

setemupknockem, yes, thank you. In my post, I mentioned, "My guess is that Google's stock split from 3/27/14 is throwing off Morningstar's figure because their 3-year TR for GOOGL looks right, though I still don't get how they computed 12.43% for the 5-year TR."

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Pajamas
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Joined: Sun Jun 03, 2012 6:32 pm

Re: GOOGL's total return

Post by Pajamas » Tue May 22, 2018 10:18 am

football236 wrote:
Tue May 22, 2018 9:43 am
Alexa9, thanks. I'm nearly entirely in index funds but own Google shares as well and wanted to compare the incremental return I received on my Google shares over the last five years compared to the S&P 500 as well as a potential property investment. I thought it would be a quick glance on Morningstar, but when the figured showed up as 12.43%, my gut told me that figure is wrong given the S&P 500's total return was similar for the same period, and I know GOOGL outperformed the S&P 500.

setemupknockem, yes, thank you. In my post, I mentioned, "My guess is that Google's stock split from 3/27/14 is throwing off Morningstar's figure because their 3-year TR for GOOGL looks right, though I still don't get how they computed 12.43% for the 5-year TR."
Could it be that since the split was into two different classes of shares with different ticker numbers that the computation is displaying the return for one class only and that the true return would reflect the return of both classes?

I have found that even straightforward splits can really throw off stock charts and data on other websites although I don't use Morningstar's charts on a regular basis, so it wouldn't surprise me if the two classes is what is causing the problem.

football236
Posts: 11
Joined: Thu Jun 22, 2017 11:49 am

Re: GOOGL's total return

Post by football236 » Tue May 22, 2018 11:57 am

That's a good point. Splits cause trouble in general, let alone when a new asset class is made.

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