Google Inc shares set an all-time high on Monday, with the Web giant’s reliable advertising business back in vogue among Wall Street investors disenchanted with younger social media companies.<\/p>\n
The stock reached $748.90 in afternoon trading, inching past a previous record set in November 2007 of $747.24. It traded below $300 in 2009 during the global economic crisis and remained under pressure in the ensuing years as investors worried that Google’s best years were behind it.<\/p>\n
The world’s No.1 search engine, which generated $38 billion in revenue last year, now looks increasingly attractive compared with a new crop of social Web companies, analysts say.<\/p>\n
Facebook Inc, as well as once-hot companies Zynga Inc and Groupon Inc, came to the public markets amid sky-high expectations during the past year, but have fallen out of favor on concerns about their future business prospects.<\/p>\n
“The markets have to come to appreciate that Google’s been making money hand over fist all this time,” said Brian Wieser, an analyst at Pivotal Research Group.<\/p>\n
Google’s lucrative search advertising business, as well as its efforts expanding into display and mobile advertising, have helped the company maintain robust revenue growth.<\/p>\n
In contrast, Facebook faces much more uncertainty.<\/p>\n
“It’s so new that there’s a lack of data points for anyone to point to,” Wieser said.<\/p>\n
At the helm<\/strong><\/p>\n The stock was up almost 2 percent at $748.20 in early afternoon trade. It has surged roughly 27 percent since mid-July, compared with the Dow Jones Industrial Average’s roughly 6 percent gain and a 9.5 percent rise on the Nasdaq.<\/p>\n But at roughly 17 times expected 2012 earnings, it still trades at a hefty discount to Facebook’s roughly 47 price-earnings multiple.<\/p>\n Google’s rising stock price comes about a year-and-a-half after co-founder Larry Page returned to the chief executive’s role, replacing Eric Schmidt, who had the helm of the Web company for the previous decade.<\/p>\n Page has moved aggressively to pare the company’s sprawling portfolio of products, eliminating projects involving green energy and health among others, while stepping up Google’s social networking efforts.<\/p>\n But many of the challenges that pressured its stock in the past have not gone away. The company’s ability to manage the $12.5 billion acquisition of Motorola Mobility — Google’s first major foray into the lower-margin hardware business — remains unproven.<\/p>\n And Google is now facing significant regulatory scrutiny around the world, including antitrust investigations in the United States and in Europe.<\/p>\n Related articles<\/strong><\/p>\n Google tops Facebook as biggest display ad earner<\/strong><\/a><\/p>\n Google antitrust probe should be done before 2013<\/strong><\/a><\/p>\n Google appeal stalls Authors Guild lawsuit<\/strong><\/a><\/p>\n Google commentator list insufficient – judge<\/strong><\/a><\/p>\n