NEW YORK (TheStreet) -- Google's (GOOG) investment division, Google Capital, made its second major investment this month, providing $85 million to startup credit and finance website Credit Karma.
The San Francisco based company offers free credit reports to customers and has a consumer base of about 20 million. The website presents targeted advertisements to customers based on those credit reports.
Google also invested $50 million in real estate website Auction.com last week. That website connects buyers and sellers in the real estate market and has sold $26 billion in property since its inception. In exchange for the investment a representative from Google Capital receiveda seat on the company's board of directors Auction.com has been valued at $1.2 billion.
With this latest investment, Credit Karma has raised $118 million since its founding in 2008. The company plans on using the money to more than double its workforce before unveiling its latest product in a couple of months.
Google Capital plans to invest $300 million by the end of the year
TheStreet Ratings team rates GOOGLE INC as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate GOOGLE INC (GOOG) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and compelling growth in net income. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- GOOG's revenue growth has slightly outpaced the industry average of 16.5%. Since the same quarter one year prior, revenues rose by 16.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Although GOOG's debt-to-equity ratio of 0.06 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 4.28, which clearly demonstrates the ability to cover short-term cash needs.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 46.69% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GOOG should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- GOOGLE INC has improved earnings per share by 14.2% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, GOOGLE INC increased its bottom line by earning $36.04 versus $32.47 in the prior year. This year, the market expects an improvement in earnings ($51.96 versus $36.04).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Internet Software & Services industry average. The net income increased by 17.0% when compared to the same quarter one year prior, going from $2,886.00 million to $3,376.00 million.
- You can view the full analysis from the report here: GOOG Ratings Report