It's Good to Be Google

SAN FRANCISCO -- It's as if nobody ever doubted Google(GOOG Quote).

Forget about the company's anxiety-inspiring fourth-quarter results in January. Or the number of times users had clicked on ads during that same month. Or a stock price that had hovered around a 52-week low.

That's all history.

Google shares have been on an upswing ever since the company reported a strong first quarter last month. And despite dropping 1.7% on Friday to $573.21, the stock has still climbed 28% from where it traded the day before reporting its first-quarter results in April.

Derek Brown, an analyst for Cantor Fitzgerald, says Google was carrying a lot of baggage heading into the first quarter, with investors still worrying that the macro-economy would take its toll.

Data released from research firm comScore, which reported slowing paid clicks for Google in January, certainly didn't help.

"What has been demonstrated since is that that concern was largely overblown," says Brown, whose firm doesn't have a relationship with Google.

Indeed, the Internet giant's rebound has essentially wiped away all that pent-up fear. Brown, who maintains a price target of $750 on Google, notes that the company's fundamentals haven't changed, but investors' perception has.

However, Cowen analyst James Friedland says the redemption granted by shareholders may be premature. The company didn't blow out first-quarter results, and given the fact that the search industry has never really contended with a recession -- or was too young to really be battle-tested -- it's still too early to tell how much Google can withstand.