Google Hype: Is it Overdone?

Pinnacle Digest writes: Google Inc. completed its largest quarterly rally in 7 years Friday, rising an astounding 30%. Ebeling is beginning to wonder if the hype surrounding the world's largest online search engine is becoming overdone.

To put the increase in perspective, the company’s Q3 rise was more than 5 times the 5.8% gain in the Standard & Poor’s 500-stock index over the same period. Google’s rally this quarter represented the 2nd biggest contribution to the S&P 500 of any company in the Standard & Poor’s 500-stock index, behind that of Apple Inc. (NASDAQ:AAPL).

In respect to the Nasdaq, as of Friday afternoon, Google had accounted for about 12% of the Nasdaq Composite Index’s advance during the period, also good enough for 2nd place behind Apple. Google reports earnings on October 10th and shareholders will look for further stabilization in search-ad fees, which saw improvement earlier this summer.

Google’s rally has raised its market value to roughly $247 billion, approaching Microsoft’s market capitalization of about $249 billion. Among US companies, only Apple and Exxon Mobil Corp. (NYSE:XOM) are worth more.

Competition between the businesses of the search company and the iPhone maker remain an issue for investors. Apple’s recent decision to replace Google’s popular maps tool with its own maps service on new iPhone software is the latest indication they could butt heads as they expand in mobile computing.


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