Feeds

Analyst: Google to hit $630 a share in 07

Crazy times. Again.

Intelligent flash storage arrays

A year after people wondered whether Wall St had taken leave of its senses by over-valuing Google, the analysts are back with more fantastic predictions.

Piper Jaffray's Safa Rashtchy has again pumped up his target price for Google stock, to $630 from $600 for 2007, while projecting earnings coming in at $16.59 a share.

Rashtchy is placing his faith in Google's ability to continue growing its online advertising revenue using the cross-pollination created by the Google's non-search related products such as maps and blogging tools.

According to Piper's analyst, non-search products create a "virtuous cycle of brand affinity" that increase use of the site and its core search engine.

What does Rashtchy base his predictions on? An "in-house survey of internet users."

While Google's shares are likely to continue moving upwards during 2007, and those who baulked at the $85 asking price when Google listed back in 2004 will continue to kick themselves for not buying then, it's worth taking a little time out.

First, it was in January 2006 when Rashtchy last raised his guidance from $445 to $600. According to no less an authority than Google's own financial charting site, the giant came in a little shy of the "high end", hitting a 52-week high of $513.

Missing Wall St expectations by as little as a penny usually prompts furrowed brows and searching questions. Google missed this analyst's prediction by $87.

At the time, Rashtchy said he "expected" new initiatives from Google would generate "meaningful revenue" by the end of 2006. Very shortly afterwards, later in January to be precise, Google launched its Video Marketplace, pushing shares up to $466.

As 2007 dawns and Google tears away from its second largest competitor, Yahoo!, in spectacular fashion, there's a new element Wall St analysts must factor into their predictions, which was lacking in 2006: Microsoft.

While Microsoft's online ads revenues are currently going "sideways" and its search service struggles to gain market share, it will surely be only a matter of time before the gravitational power of the Microsoft brand takes effect and begins to siphon business away from Google.

Next, if recent history has taught us anything about research from financial analysts, it's that the research should be handled very carefully. Jeffries & Co analyst Katherine Egbert's "independent checks" convinced her Oracle was close to launching its own Linux. What we got, instead, was Oracle's Red Hat support network.

Finally, experience tells us a Wall St office or brokerage floor is not at all representative of the IT market in general.®

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
'Cowardly, venomous trolls' threatened with TWO-YEAR sentences for menacing posts
UK government: 'Taking a stand against a baying cyber-mob'
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
Don't bother telling people if you lose their data, say Euro bods
You read that right – with the proviso that it's encrypted
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Win a year’s supply of chocolate
There is no techie angle to this competition so we're not going to pretend there is, but everyone loves chocolate so who cares.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.