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Google at $600? Welcome Back, Henry--Er, I Mean Safa


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January 03, 2006

Google at $600? Welcome Back, Henry--Er, I Mean Safa

Rob Hof

Piper Jaffray analyst Safa Rashtchy raised his target price on Google today to $600 by year-end. I'm sure I'm not the only one who's reminded of former CIBC Oppenheimer (then Merrill Lynch) analyst Henry Blodget's famous $400 target price on Amazon in October 1998. Of course, Blodgett turned out to be right. For awhile. Don't be surprised if it's the same with this $600 target. At the same time, don't be surprised if it falls way below that at some point. Google's an awesome company, but nobody's perfect.

Oh, and Blodget himself? He was nervous when Google was passing $400.

Update: Here's Blodget's latest take.

: He can't stop: More from Blodget.

(Photo courtesy of Morguefile)

01:00 PM

Google, bubble

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? Blodgett 2.0 ? from Zoli's Blog[Read More]

Tracked on January 4, 2006 10:29 AM

That's super-bold. But Google's only revenue stream thus far is still advertising, and how far can that go on cash cow search engine Google.com?

Google Planet is outright cool. Google's putting books online is almost benevolent, though copyright watchdogs are barking loud. To put the knowledge of the entire planet across centuries on our fingertips.

Imagine that.

But are these enough to ensure market capitalization over $200 billion?

Posted by: riversandlakes at January 3, 2006 07:19 PM

"former CIBC Oppenheimer (then Merrill Lynch) analyst Henry Blodget's" What? This line makes no sense.

Posted by: thc at January 13, 2006 10:59 PM

Well, not the most elegant phrasing, I admit, but in any case: Blodget was an Oppenheimer analyst when he made the prediction, then joined Merrill soon after.

Posted by: Rob Hof at January 13, 2006 11:41 PM

A lot of people are focusing on Blodget's discussion of click fraud and the potentially negative impact on Google. To me, this is almost a non-issue. Big advertisers already factor click-fraud into their click prices. Of course, if click fraud increases, CPC prices would decrease. But, if Google cleans up click fraud further, this would actually result in an increase in CPC prices.

The big issue for me is that there are a lot of "euphoria" investors who seem to push the stock higher every time Google launches a new product (like Google Pack, Google Video, Google Base, etc). These products - as Blodget notes - have yet to generate any significant revenue for Google and for Google's stock to increase on this basis seems problematic.

I tried to summarize some of the arguments pro and con for Google's stock price on my blog. The post is available here: http://blogation.blogspot.com/2006/01/why-google-is-bear-and-why-its-bull.html. I'd love to get comments from folks . . .

Posted by: David at January 15, 2006 12:28 AM

Just when this article started to create a buzz in the web, there is a strong indication of a Google stock price free-fall.

http://abcnews.go.com/Business/wireStory?id=1609485

Posted by: EWC21 at February 12, 2006 09:13 PM


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