Difference Between GOOG and GOOGL (With Table)

Every company that wishes to raise funds from the public needs to be registered in the stock market. Google is one of the tech giants that raises funds from the public but in a different manner. In 2012, Google announced a 2-for-1-stock that later came into effect in the year 2014. GOOG and GOOGL are two sets of shares announced by Google.

GOOG vs GOOGL

The difference between GOOG and GOOGL is that GOOG refers to Class C shares issued by the Google company, whereas GOOGL refers to the Class A shares that are issued by Google company. GOOG set of shares do not carry any voting rights, whereas GOOGL set of shares carry one vote each.

GOOG set of shareholders do not enjoy any voting rights in the company; hence they are not involved in the decision-making process. Google promised this set of shareholders that it would compensate them in case if the price of shares fell below 1 percent.

GOOGL set of shareholders enjoy voting rights in the company and hence can take part in the decision-making process. They are also referred to as Class-A shares. These shares are issued by Alphabet Inc. that was founded in the year 2015 through a reconstruction of Google.

Comparison Table Between GOOG and GOOGL

Parameters of ComparisonGOOGGOOGL
Class of sharesGOOG refers to Class C type of shares. GOOGL refers to Class A type of shares.
Institutional holdersThe major institutional holders of GOOG shares are J.P. Morgan Chase & Company, Capital International Investors, and Alliance Bernstein.The major institutional investors of GOOGL shares are State Street Corporation, Norges Bank Investment Management, and Blackrock Inc.
Voting RightsThe shareholders of GOOG do not enjoy any voting rights due to which they have no power to make decisions.The shareholders of GOOGL enjoy voting rights due to which they have the power to make decisions.
Fees chargedSince GOOG is a Class C share, a fee is imposed throughout the holding period.Since GOOGL is a Class A share, a fee is imposed at the purchase of the share.
Special considerations and discounts This set of shares are not eligible for bulk discounts This set of shares are eligible for bulk discounts and special considerations.
IncentivesGOOG provides incentives and benefits to mainly short-term investors who prefer intra-day trading.GOOGL shares provide incentives to long-term investors.

What is GOOG?

The 2-in-1 split of Google caused the formation of GOOG that is a Class-C share. Many shareholders who were allotted GOOG shares were unhappy at that time as they were granted no power of voting. When the split took place, the shareholders were allotted half of GOOG shares and half of GOOGL shares, taking into consideration their previous holdings.

One of the major characteristics of GOOG shares is that when this share is sold, a share of class B must be converted to class A. One of the major demerits of this set of shares is that the shareholders do not enjoy any sort of voting rights due to which they cannot participate in the decision-making process.

In the year 2020, the share price of GOOG stood among the top 8 share prices in the United States stock market. GOOG offers its services in various domains. It was one of the top 100 Digital companies in the world in the year 2019.

It was also ranked at 13th position by the Forbes magazine in its top 2000 Company’s list and 5th in position in its Just Companies 2021 survey. The performance of this stock has been mixed, it was at its highest in 2020, but since the start of 2021, it has constantly been falling.

What is GOOGL?

When the split happened in the year 2014, people were also allotted GOOGL shares, the shareholders who have been allotted these shares were satisfied as these shares carry voting rights that provide them a say in the decision-making process.

GOOGL provides its services in various fields. Google Chrome, Google Play Store, and Google maps are some of its well-known products. The GOOGL stock has gained almost a 100% in the past 5 years. It is a Class A share of Google, due to which it is eligible for huge discount considerations.

The Class A share charges a term called front-load, which means that the shareholder is obliged to pay a portion of the purchase every time he/she buys the shares. If an individual is a long-term investor, then he/she must prefer buying GOOGL shares as it will fetch them a better return in the next 10 years. This is because it is a Class A share.

This stock has been performing well since its listing. It may not be as profitable to short-term investors but has made long-term investors wealthy.

Main Differences Between GOOG and GOOGL

  1. GOOG is a Class C share, whereas GOOGL is a Class A share.
  2. GOOG shares are highly profitable for short-term investors, whereas GOOGL shares have been highly profitable for long-term investors.
  3. The prominent Institutional investors of GOOG are J.P. Morgan Chase & Company, Capital International Investors, and Alliance Bernstein. On the other hand, the prominent Institutional investors of GOOGL are State Street Corporation and Norges Bank Investment Management.
  4. The GOOG shares do not enjoy any sort of voting rights, whereas the shareholders of GOOGL shares enjoy voting rights.
  5. GOOG shares are not eligible for bulk discounts, whereas GOOGL shares are eligible for special considerations and discounts.

Conclusion

The split of google shares led to unrest among the people in the year 2015, but both the sets of shares of Google are performing extremely well and have not disappointed many people. They have given decent returns and have also made their shareholders wealthy.

The major difference between both of them is regarding their class and availability of voting rights. Google is one of the top tech companies in the world and is offering its services in various domains ranging from navigation to search engines. The parent company of both GOOG and GOOGL is Alphabet Inc.

References

  1. https://www.sciencedirect.com/science/article/pii/S0304405X11000717
  2. https://www.sciencedirect.com/science/article/pii/S0304405X97000457

x
2D vs 3D