Google’s stock price reached an all-time high today, hitting $750 before closing at $749.38. The company rose $15.39, or 2.10 percent for the day.
The record closing price, which comes amid a 30 percent increase since June, comes on the heels of a new analyst report setting a price target at $850 (up from $740). Its previous record high of $747.24 was set in November 2007. The company now has a market capitalization of more than $244 billion.
The report, from Citi analyst Mark Mahaney, said Google’s stock will continue to surge based on increased spending on search advertising, reduced competitive threats and an improved situation at newly acquired Motorola.
Search ad spending will grow around 20 percent in the third quarter, Mahaney said. Product listing advertisements, which add price, images and other information, will host revenue as well, he said. And the company is making a new effort to monetize Google Maps, launching new features both for users and advertisers.
Meanwhile, Google has streamlined operations at Motorola, eliminating 4,000 employees and closing a third of its 94 offices worldwide. It also is reportedly looking to sell Motorola Home, which makes set-top cable boxes, for as much as $3 billion — which would make the net cost to Google of the purchase around $6 billion. Given that the move brought Google more than 17,000 patents in the middle of an intellectual property war with its rivals, the purchase is less risky than it first appeared, the report argues.
As for competition? Mahaney says search is getting less competitive over time, not more. The integration of Bing and Facebook has yet to put a significant dent in Google’s market share, and Facebook’s own search ambitions are unlikely to compete with Google directly, he wrote.
There are still threats looming on the horizon for Google — regulatory issues, building ads for mobile products and integrating Motorola, to name three. But for now Google investors are sitting pretty — and it looks their position still has plenty of room for improvement.