Canaccord Remains Bullish on Google (GOOG) Following Search Engine Strategies Conference

August 25, 2008 11:43 AM EDT

Canaccord Adams is out with a research note on Google (Nasdaq: GOOG) this morning. Following last week's Search Engine Strategies conference in San Jose, the report highlights several takeaways. The firm maintains its Buy rating and $650 price target on Google.

Key points from the meetings, according to Canaccord, include:

• Google continues to innovate in areas such as "facial imaging search, a new version of iGoogle that levers side-tabs, its OpenSocial platform that allows gadgets to communicate with one another, and virtual product Lively."
  
• Google gained 40 basis points of market share during July, now 61.9%, and
  
• certain transactional searches may see an increase in ad coverage

Turning to the bearish argument for Google, Canaccord sees concerns related to weaker-than-normal SEM's and a spike in headcount versus last quarter due to college graduates entering the workforce over the summer.

Canaccord's $650 price target is based on 25x the firm's FY09 EPS estimate, which it says is in-line with projected growth. With shares of Google trading around $487 today, the firm's price target represents possible upside of more than 33% from current levels.

Google, Inc., a technology company, maintains index of Web sites and other online content for users, advertisers, Google network members, and other content providers.

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