google +11% == $100billion lol

Google hits all-time high
Shares of search leader rise more than 11% after a strong 3Q, sending market value near $100B.
October 21, 2005: 3:30 PM EDT
www.cnn.com

NEW YORK (Reuters) - Google Inc. shares rocketed to an all-time high Friday as an impressive round of quarterly results appeared to win over skeptics worried that the Web search company was more bark than bite.

Google (up $36.18 to $339.38, Research) shares rose over 11 percent in Nasdaq trade. Google, whose stock is now up more than 300 percent from its initial public offering 14 months ago, is approaching $95 billion in market value.

Its earnings report -- issued on Thursday -- showed the company surpassed Wall Street expectations for the fifth straight quarter since its initial public offering. Behind its results was what the company called a "sea-change" shift to Internet marketing from print and broadcast.

Although Google has long been a hot spot for users searching for everything from news to long-lost friends, some have questioned whether the company can turn its popularity into steady advertising dollars. Its earnings report appeared to put those questions to rest -- at least for now.

"They've come up with a new product that is changing the way people are advertising," said ThinkEquity analyst John Tinker. "They are changing the way people are doing business."

Before the stock market opened on Friday, analysts quickly issued another round of Google upgrades. Among those, Needham boosted its price target to $370 from $300 a share, while Banc of America Securities increased its target to $360 from $280.

First Albany and Lehman Brothers went further, upping their price objectives to $450 a share.

Other Internet stocks also got a boost from the rally, with eBay Inc. (up $0.37 to $39.52, Research) up 1.2 percent, Yahoo Inc. (up $0.13 to $35.39, Research) gaining 0.3 percent and Baidu.com Inc. (Research) adding nearly 7 percent.

Internet marketing company aQuantive Inc. saw its shares rise 7.5 percent to $21.17.
Year-end Nasdaq rally?

"Google's earnings may reaffirm that tech is not dead," said Tim Biggam, chief options specialist at options brokerage Man Securities. "Normally the fourth quarter is by far the best performing quarter for technology stocks and Google earnings may provide the impetus for a year-end rally in the Nasdaq."

Google said third-quarter net income rose to $381.2 million, or $1.32 per diluted share, from $52.0 million, or 19 cents a share, a year earlier. The prior quarter included a noncash charge of $201.0 million to settle a patent dispute.

Gross revenue jumped 96 percent to $1.58 billion. Analysts, on average, had projected revenue of $1.46 billion.

"I think people are going to look at the Internet again even if they have been burned in the past," said Mark Herskovitz, manager of the Dreyfus Premier Technology Growth Fund.

"From a historic perspective, I would say that it is not uncommon for new technologies to emerge and for investors to become overly enthusiastic, which is what happened with Internet round one, and then become unduly pessimistic after their initial expectations were not realized," added Herskovitz. The $2 billion fund owns 170,000 shares of Google.

While Wall Street welcomed the upside surprise, some analysts also raised questions about the company's visibility.

Merrill Lynch analyst Lauren Rich Fine wrote in a research note that Google had a "great" quarter but surprises "cast some doubt on management's ability to predict its own business."

ThinkEquity's Tinker also voiced concern about visibility.

"At some point there is going to be a blowup in this company because they don't provide any metrics and there are no good models on this stock," he said.

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