Google shares muscle past $700 as madness continues

Posted Nov 1st 2007 9:56AM by Brian White
Filed under: Major Movement, Google (GOOG)

Google, Inc. (NASDAQ: GOOG) has done it again. After passing the $600 mark earlier this year, the company's stock price jetted above the $700 level yesterday, closing at $707.00 on the spookiest day of the year, literally and figuratively. While I am a huge Google fan, are these levels justified?

From a fundamentalist perspective, the share price is way out of whack. Some may even look back to the days of the dot-com madness of 2001 in looking over Google's current valuation.

Although, in just over a year, the company has added in more partnerships and has extended its hands deeply into so many pockets that its overall reliance on text-based advertising may wane slowly in 2008. This is by design: Google needs an Act II and the planning for that is well underway. Still, it's not there yet, although its share price reflects either some insane hype or unknown potential that traders are finding in that magic 8-ball.

Google's $200+ billion market cap has been raised 34% just since September, during which it reported another stellar quarter of results, which I liveblogged here. If you held Google shares at the start of 2007, have you cashed in with the 54% return you've seen this year?

If so, why? If not, why?

If Google turns into the advertising leader in the hot-to-trot social networking scene, it could be poised to hit even higher levels.

Tags: GOOG, Google shares, Google stock price, Google, Inc., Google,Inc., GoogleShares, GoogleStockPrice, inthenews

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Reader Comments (Page 1 of 1)

11-01-2007 @ 10:57AM

Tom J. Donohue said...

Google’s stock price may or may not be overvalued. In determining its value, investors need to keep in mind the business deals the company is pursuing, such as a rumored liason with T-Mobile, which could help both companies to harvest new revenue growth.
Another point to be mindful of is that Google is in a position to strike business savy deals because of the personal relationships its executives and directors have across the business world.
To uderstand the specifics of how personal relationships might play a role in Google’s purported courtship of T-Mobile see the NewsVisual article: http://www.newsvisual.com/newsvisual/2007/10/google-and-t-mo.html

11-01-2007 @ 11:43AM

Michael Stuart said...

I remember Jim Cramer stating not to buy a stock if it is trading twice its PEG ratio. Correct if if I am wrong. Google is at 1.29 compared with Yahoo is 2.91,Ebay is 1.32,Bidu is 2.82,Vmw is 3.48,Msft is 1.58. Plus it is growing faster than most internet players.
If google had split its stock like that of ebay (split 4times or Yahoo (split 5 times) it would only be at a range of 25-45.......Now would that Make you think Twice. Google at 25-45 dollars would be cheap..Right!
Again don't look at a stock price especially if it never split. Warren Buffet shares were 250 dollars a share 20years ago and are now well over 100thousand per share.
I though even Brian White would figure this one out.

11-01-2007 @ 12:36PM

Andy said...

There has never been a company like Google and there has market with as much growth potential as the shift in advertising from print to the internet. The income stream that they derive from advertising gives them the ability to develop other new technologies in unlimited cyberspace.