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When Will Google Reach $1,000?

NEW YORK (TheStreet) -- Known for wanting to be everything to everyone, Google (GOOG) often seems misunderstood in the eyes of investors. Whether in smartphones or tablets, apps or maps, and now Google is working to become an ISP, an internet service provider.

While you would be correct to call this variety of ambitions scattered, you must also call Google successful. And the company's stock price, which recently hit a wall after reaching $928, has become a concern for investors, who are worried about the company's growth potential.

Despite its search dominance, Google never rests.

The company is in simultaneous battles with titans like Apple (AAPL) and Facebook (FB) to win control over mobile and social media, while at the same time fighting a war with Microsoft (MSFT) in device browsers and operating systems. As if this was not enough, now Google wants to take on other ISPs like Time Warner Cable (TWC).

Essentially, Google couldn't find a dull moment no matter how hard it looked. What it also means, though, is that the company must spend a lot of money to fund these wars.

And for a big as Google is, the fact that the company is still able to grow at a 20% rate is no small accomplishment. This level of growth does not come cheap. And it's time that investors come to terms with what they are paying for when buying these shares.

Upon reaching its new 52-week high of $928, the stock lost roughly 6%, falling as low as $875.61 following its second-quarter earnings report, in what I can only describe as an overreaction.

I will grant that the 65% decline in Motorola's revenue was a pretty significant number, but let's not pretend that it's been a key component in Google's growth. It's a legacy business that's being phased out of Google's core operation.

Despite Motorola's poor showing, which should not be confused with a disappointment, Google still posted 19% growth in consolidated revenue. When factoring the 16% growth in web site revenue and the slight decline in network revenue, the company still managed to grow overall net revenue by 21%. Net revenue is realized when all the extras outside Google's core business are taken out.

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