Jefferies Comments on Google (GOOG) Ahead of Q2 Earnings, Price Target Calls for 52% Upside
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Price: $343.54 -0.12%
Rating Summary:
44 Buy, 6 Hold, 0 Sell
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Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
44 Buy, 6 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Jefferies is reiterating its Buy rating and $800 price target on shares of Google (NASDAQ: GOOG) as it believes that Q2 earnings will fall inline with expectations.
Traction with display, mobile and social (G+), as well as valuation, has kept the firms belief in Google positive.
Industry checks indicate that paid search growth has fallen in Q2 from from high to low teens year-over-year. The firm notes that this is due to a pull forward of domestic demand to Q1 from Q2, and the EMEA showing a material deceleration on macro concerns.
As a result, Jefferies is modeling top line growth deceleration of 26.7 percent year-over-year from 29.1 percent in Q1, resulting in revenues of $6.45 billion and EPS of $7.70; the Street is currently at $6.54 billion and $7.86
The firm states that CPC inflation continues in between the high single digit to low double digit growth rate year-over-year.
An analyst at Jefferies comments, "We expect margins in Q2 to remain under pressure from heavy investment/hiring plans. Further disclosure around litigation from US regulators and Oracle's (Nasdaq: ORCL) patent dispute around Java is not likely. That said, more disclosure around display/mobile revenue contribution should be provided as management wants to get credit for its success in those categories."
For more ratings news on Google click here and for the rating history of Google click here.
Shares of Google closed at $527.28 yesterday.
Traction with display, mobile and social (G+), as well as valuation, has kept the firms belief in Google positive.
Industry checks indicate that paid search growth has fallen in Q2 from from high to low teens year-over-year. The firm notes that this is due to a pull forward of domestic demand to Q1 from Q2, and the EMEA showing a material deceleration on macro concerns.
As a result, Jefferies is modeling top line growth deceleration of 26.7 percent year-over-year from 29.1 percent in Q1, resulting in revenues of $6.45 billion and EPS of $7.70; the Street is currently at $6.54 billion and $7.86
The firm states that CPC inflation continues in between the high single digit to low double digit growth rate year-over-year.
An analyst at Jefferies comments, "We expect margins in Q2 to remain under pressure from heavy investment/hiring plans. Further disclosure around litigation from US regulators and Oracle's (Nasdaq: ORCL) patent dispute around Java is not likely. That said, more disclosure around display/mobile revenue contribution should be provided as management wants to get credit for its success in those categories."
For more ratings news on Google click here and for the rating history of Google click here.
Shares of Google closed at $527.28 yesterday.
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