Google Stock Surpasses $600 A Share

(CBS/AP)  Google Inc.'s stock price sailed past $600 for the first time Monday, extending a rally that has elevated the Internet search leader's market value by about $25 billion in the past month.

The Mountain View, California-based company's shares traded as high as $601.45 before slipping back to $597.13 in morning trading. It marked the sixth time in the past 12 trading sessions that the stock has reached a new peak climbing on the lofty expectations for Google's third-quarter earnings. The results are scheduled to be released Oct. 18.

The latest milestone served as yet another reminder of the immense wealth created since the company went public in August 2004.

Google shares have increased more than sevenfold from their initial public offering price of $85, leaving the 9-year-old company with a market value of $187 billion worth more than bigger, more mature businesses like Wal-Mart Stores Inc., Coca-Cola Co., Hewlett-Packard Co. and IBM Corp.

It took slightly more than 10 months for Google's stock to make the leap from $500 to $600. By comparison, the journey from $400 to $500 required more than a year to complete. The shares hurdled $300 in June 2005 after passing the $100 and $200 thresholds in 2004.

Analysts began predicting Google's stock would reach $600 at the start of 2006 when the shares were still hovering around $420. Some analysts already are advising investors that Google's stock will hit $700 within the next year. The average target price for the stock is $606.61 among 28 analysts polled by Thomson Financial.

The biggest beneficiaries of Google's co-founders have been Larry Page and Sergey Brin, who began developing a new approach to online search, then called "BackRub," in a Stanford University dorm room in 1996. Page and Brin, both 34, now rank among the world's wealthiest men with fortunes approaching $20 billion apiece.

Google's chief executive, Eric Schmidt, and top sales executive, Omid Kordestani, also have accumulated enough stock in the company to become multibillionaires.

Hundreds of other Google employees are millionaires.

Google's stock has reigned as one of the hottest commodities on Wall Street because its search engine has turned into a moneymaking machine as advertisers spend more on the Internet to connect with consumers who are increasingly shunning television, radio and traditional print media. Google's search engine is the hub of the Web's most lucrative ad network.

If it gets its way, Google could become an even more powerful through its proposed $3.1 billion acquisition of ad distributor DoubleClick Inc. The deal is being held up while federal antitrust regulators review complaints that the acquisition would give Google too much control over online ad prices and personal information collected from consumers.

The recent enthusiasm surrounding Google's stock contrasts with the mood less than two months ago. Dragged down by a second-quarter earnings report that lagged analyst projections, Google's stock dipped below $500 in mid-August.

But the bulls stampeded back to Google's stock as it became more apparent the company had widened its already formidable lead over Yahoo Inc. and Microsoft in the battle to process the search requests that trigger revenue-generating advertisements.

The more positive sentiment has driven a 15 percent increase in Google's stock since Sept. 7. For the year, the shares have climbed by 30 percent, outstripping the stock market's major indexes.