Figure This: Google 2K

A Caris analyst does the math to justify a four-digit stock price -- while insisting it's not a target.
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Google

(GOOG) - Get Report

shares at $2,000? That's what Caris & Co. analyst Mark Stahlman says is theoretically possible.

In note issued to clients Thursday, Stahlman stresses that he isn't setting an official price target for the stock of the Mountain View, Calif.-based company. New York-based Caris doesn't set price targets for stocks. Earlier this week, Safa Rashtchy of Piper Jaffray, which evidently does set price targets, predicted that Google's shares would hit $600. So far that's the highest projection of any analyst.

"We believe that Google's addressable market has a chance to become much larger, more quickly than initially anticipated, perhaps a $100 billion annual sales company over time," Stahlman writes. "Google is not limited to the size of today's advertising market and is likely to expand into next generation financial services, and health care, among other digital service opportunities considerably larger than typically recognized."

In an interview, the 57-year-old Stahlman, who as an investment banker wrote the prospectus that brought America Online public, stresses that he believes that the excitement over Google is different than the hype he saw during the Internet bubble of the late 1990s.

"We now have the technology to actually build out digital services," he says. "We didn't have broadband available in the 1990s. We didn't know how to build grids of computers."

Google, whose shares more than doubled last year, has considerable potential to grow. Stahlman estimates that Google's share of the $2 trillion digital services market, which he says has the potential to expand to $10 trillion annually, is about 0.3%. He arrived at his theoretical price -- not a price target, by any means -- by multiplying the 6.2 multiple that

Microsoft

(MSFT) - Get Report

now fetches on an enterprise-value-to-trailing-12-months-sales basis by what he sees as Google's potential $100 billion in revenue.

Stahlman's analysis is the latest attempt by Wall Street to figure out the potential growth of the largest search engine company, a difficult task even for the most ardent Google admirers given that the company doesn't give earnings guidance and is on the cusp of what is widely considered to be a nascent market.

But analysts are still giving it their best shot. Goldman Sachs' Anthony Noto Thursday raised his price target for Google to $500 from $400 and raised his fourth quarter earnings per share estimate to $1.69 from $1.62. Analysts are predicting that the company will earn between $1.51 and $1.95, according to Thomson Financial. Noto also raised estimates for

Yahoo!

(YHOO)

. He rates both shares as outperform.

Google is expected to announce plans Friday to allow customers to buy content from providers. It also will provide a downloadable bundle of software to allow people to set up new computers without using Microsoft programs.

Shares of Google rose $6.03 to $457.27.