You Go, Google

Search is fashionable again on Wall Street.

A day after Google delivered another dazzling quarter of earnings far ahead of Wall Street's expectations, analysts rushed to boost their estimates as investors hustled to bid up the share price.

Google's stock was trading up 6.4% to $217.20 heading into the close Friday, having traveled as high as $224 earlier in the day. The stock is above the previous high of $216.80 on Feb. 2, when Google's previous earnings report also exceeded expectations. After that, the stock dropped to as low as $174.21 last month.

Some of the analyst comments started to take on a happy-days-are-here-again tone. "It's hard to deny that Google has put up a string of tremendous results and is putting the 'hyper' back into the 'hyper growth' Internet sector," says Robert Peck, an analyst at Bear Stearns, which does not have an underwriting relationship with Google.

In the quarter ended March 30, Google said revenue nearly doubled and its profit came in more than five times larger than the year-ago figure. The Mountain View, Calif., company earned $369 million, or $1.29 a share, up from the year-ago $64 million, or 24 cents a share. Analysts had been forecasting a profit of 92 cents a share.

Google said its total revenue rose 93% to a record $1.26 billion in the quarter. Net revenue, or revenue excluding the fees from search-engine advertising partners, jumped to $794 million.

After Google's strong first quarter, Peck boosted his estimate for Google's 2005 revenue up to $3.7 billion from his previous estimate of $3.4 billion and his pro forma EPS to $5.71 from $4.35. "Looking for negatives in the quarter is a tough search in itself," Peck says. "Slightly higher traffic acquisition cost rates and lumpier capex (although still on year-end target) can provide some fodder for the bears, but otherwise the quarterly results were impeccable."