Search engine's stock passes $600
NEW YORK - Shares of Google Inc. surpassed $600 a share Monday to join five other stocks, including that of Chicago-based CME Group Inc., in that exclusive club.The stock rose $15.57, or 2.6 percent, to $609.62, on the Nasdaq stock market, extending a monthlong rally propelled by the lofty expectations surrounding the Internet search leader's impending third-quarter earnings report.It marked the sixth time in the past 12 trading sessions that the stock has reached a new peak, indicating investors are confident Google's third-quarter profit will be impressive. The results are scheduled to be released Oct. 18.
Warren Buffett's Berkshire Hathaway Inc. has the two highest-priced stocks in the U.S. The Class A shares closed Monday at $123,390, and the Class B stock finished at $4,109.99. The others above $600 are Seaboard Corp., a food processor and cargo shipper, at $1,841.01; Washington Post Co., at $804.95; and CME, at $625.
The shares have increased more than sevenfold from their initial public offering price of $85, bringing the 9-year-old company's market value to $190 billion, still less than Microsoft Corp., but more than bigger, more mature businesses such as Wal-Mart Stores Inc., Coca-Cola Co., Hewlett-Packard Co. and IBM Corp.It took 10 1/2 months for Google's stock to leap from $500 to $600 and more than a year for the journey from $400 to $500. The shares hurdled $300 in June 2005, after passing the $100 and $200 thresholds in 2004.
Analysts began predicting Google's stock would reach $600 at the start of 2006, when the shares were hovering around $420. Some analysts are predicting Google's stock will hit $700 within the next year, but the average target price for the stock is $614.64 among analysts polled by Thomson Financial.Google's stock has reigned as one of the hottest commodities on Wall Street because its search engine has turned into a moneymaking machine as advertisers spend more on the Internet to connect with consumers who are increasingly shunning television, radio and traditional print media.
On Monday, Google said it will begin showing YouTube videos on thousands of other Web sites, hoping to profit from ads attached to the clips. The expansion, scheduled to be announced Tuesday, represents Google's farthest-reaching attempt yet to cash in on its $1.76 billion acquisition of YouTube since the deal closed 11 months ago. Google already shows some video ads on clips on YouTube's own site.Google's U.S. share of the Internet search market increased to 56.5 percent in August from 55.2 percent the previous month, according to researcher ComScore Inc. Yahoo had 23.3 percent, and Microsoft owned an 11.3 share.The Web advertising market in the U.S. will climb 29 percent this year, to $21.7 billion, and then more than double by 2011, according to eMarketer Inc. Ads linked to search results will account for about 40 percent of that, the New York-based researcher estimates.If it gets its way, Google could become more powerful through its proposed $3.1 billion acquisition of ad distributor DoubleClick Inc. The deal is being held up while federal antitrust regulators review complaints that it would give Google too much control over online ad prices.
From Tribune news services
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