Google's Gallant Fan
Google (GOOG) got a boost from Wall Street on a day that saw renewed speculation that the stock might be vulnerable.
CIBC World Markets analyst Michael Gallant upgraded the search-engine phenomenon from sector performer to sector outperformer over the weekend and placed a $245 price target on the stock.
News of the report coincides with the reported expiration of the last and biggest lockup on insider stock sales at Google. On Monday, analysts calculated, theoretically up to 177 milllion of Google's 286 million shares outstanding could come on the market, though many of those shares are in the hands of senior executives and are unlikely to hit the market anytime soon.
Google's shares fell $1.25 Monday to trade at $186.15. The stock, priced at $85 a share in Google's initial public offering of stock six months ago, hit a high of $216.80 in early February, following release of the company's surprisingly good fourth-quarter earnings.While Gallant's price target is by no means a Street-high estimate -- that distinction is the $275 target published by Credit Suisse First Boston and, separately, American Technology Research -- Gallant's report signals Wall Street's growing comfort with the financial performance of a prickly newcomer to the public markets. Now that the company has gotten through two quarters' worth of financial statements, neither Google's rapidly rising stock price nor forecasts of runaway growth for the company seems as outrageous as it once might have. In his report, dated Sunday, Gallant says the roughly 31% upside implied (at Friday's closing price) to his price target contrasts with a 9% risk to his expected floor for the stock of $170. Behind the upgrade is Gallant's perception that certain risks posed to Google are diminishing, such as that represented by the biggest new entrant in the search business, Microsoft's (MSFT) MSN.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV