benyl
01-03-2006, 12:11 PM
Wow, I wish I would have bought when it IPOed...
LOS ANGELES, Jan 3 (Reuters) - Piper Jaffray on Tuesday
raised its price target on shares of Internet search provider
Google Inc. by 35 percent to $600 from $445.
The new one-year target is the highest of 24 brokers with
model prices on the stock, according to Reuters Estimates.
Piper analyst Safa Rashtchy estimated that Google will
continue to generate strong, double-digit sales and earnings
growth through 2007 and gain market share as well.
Google is the leading Web search provider in the United
States, reaping virtually all of its revenue from advertising.
Its shares, which made their debut at $85 in August 2004, hit
an all-time high of $446.21 last month. The company now offers
a variety of free Web services from maps and directions to Web
e-mail.
"While the stock may have its ups and downs throughout the
year, we believe it will reach $600 by the end of 2006 and we
prefer to have one 12-month price target rather than raise it
every quarter," Rashtchy said in a client note.
The new target represents a multiple of 50 times Piper's
estimated 2007 earnings per share, excluding items, for Google
of $11.91, he said.
Google trades at around 48 times analysts' 2006 per share
earnings estimates. Yahoo Inc. , Google's closest
rival, has a multiple of just over 52, while Web auctioneer
eBay Inc. is 43, according to Reuters Estimates.
"We believe Google is an iconic company that, like
Microsoft and eBay before it, has defined a new and vital
industry," said Rashtchy.
He added that such market leading technology companies have
traditionally traded with peak valuations in the range of 50
times to 60 times earnings before items.
Software giant Microsoft Corp. has been investing
heavily in search and aims to challenge Google on the Web and
the desktop, where it has made its fortune selling software.
Microsoft's trades at a multiple of 20 times 2006 earnings
estimates.
JMP Securities has the second-highest price target on
Google shares. It boosted its target on Dec. 21 to $575 from
$400.
Google shares were up 2.9 percent at $426.90 in midday
trading on the Nasdaq.
(Additional reporting by Lisa Baertlein in Los Angeles)
LOS ANGELES, Jan 3 (Reuters) - Piper Jaffray on Tuesday
raised its price target on shares of Internet search provider
Google Inc. by 35 percent to $600 from $445.
The new one-year target is the highest of 24 brokers with
model prices on the stock, according to Reuters Estimates.
Piper analyst Safa Rashtchy estimated that Google will
continue to generate strong, double-digit sales and earnings
growth through 2007 and gain market share as well.
Google is the leading Web search provider in the United
States, reaping virtually all of its revenue from advertising.
Its shares, which made their debut at $85 in August 2004, hit
an all-time high of $446.21 last month. The company now offers
a variety of free Web services from maps and directions to Web
e-mail.
"While the stock may have its ups and downs throughout the
year, we believe it will reach $600 by the end of 2006 and we
prefer to have one 12-month price target rather than raise it
every quarter," Rashtchy said in a client note.
The new target represents a multiple of 50 times Piper's
estimated 2007 earnings per share, excluding items, for Google
of $11.91, he said.
Google trades at around 48 times analysts' 2006 per share
earnings estimates. Yahoo Inc. , Google's closest
rival, has a multiple of just over 52, while Web auctioneer
eBay Inc. is 43, according to Reuters Estimates.
"We believe Google is an iconic company that, like
Microsoft and eBay before it, has defined a new and vital
industry," said Rashtchy.
He added that such market leading technology companies have
traditionally traded with peak valuations in the range of 50
times to 60 times earnings before items.
Software giant Microsoft Corp. has been investing
heavily in search and aims to challenge Google on the Web and
the desktop, where it has made its fortune selling software.
Microsoft's trades at a multiple of 20 times 2006 earnings
estimates.
JMP Securities has the second-highest price target on
Google shares. It boosted its target on Dec. 21 to $575 from
$400.
Google shares were up 2.9 percent at $426.90 in midday
trading on the Nasdaq.
(Additional reporting by Lisa Baertlein in Los Angeles)