Jefferies Previews Google (GOOG) Q3; Sees Improvement in Ad Revs, Some F/X Headwinds
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Up: 7 | Down: 5 | New: 25
Rating Summary:
44 Buy, 6 Hold, 0 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 7 | Down: 5 | New: 25
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Jefferies issued insight into Google (Nasdaq: GOOG) ahead of third-quarter results. The firm maintained a Buy rating, and $830 price target.
Google is expected to benefit from continuing to grab market share in ad dollars for search, which currently is over 80 percent. Jefferies, and other data, shows that Google's U.S. search market share has been relatively flat at 65 percent.
Overall volume is expected to show improvement, "driven by high-teens growth in Int'l clicks and high-single digit growth in US (vs. +18% in 2Q11.) CPC inflation has continued in 3Q, and was especially high across retail and consumer electronics, and across int'l markets (~+50% Y/Y acc. to one source for APAC). This was driven by redeployment of ad$ for H211 after a pullback in 1H11, higher bids on generic keywords (Google Instant) and better conversion rates from ongoing algo/UI tweaks." Jefferies is modeling for 12 percent year-over-year growth in CPCs.
Jefferies also sees Google potentially being impacted by foreign exchange headwinds, which may take as much as 9 cents per share from earnings in the quarter.
Key issues investors should pay attention to include it's Motorola (NYSE: MMI) strategy beyond patents, regulatory issues, and Google+ metrics.
Jefferies is looking for revenue of $7.2 bllion and earnings of $8.76 per share. The Street currently expects revenue of $7.19 bllion and earnings of $8.74 per share.
Click here for more analyst color on Google, or here for a ratings history.
Google reports results on October 13th.
Google is 1.7 percent better Monday morning.
Google is expected to benefit from continuing to grab market share in ad dollars for search, which currently is over 80 percent. Jefferies, and other data, shows that Google's U.S. search market share has been relatively flat at 65 percent.
Overall volume is expected to show improvement, "driven by high-teens growth in Int'l clicks and high-single digit growth in US (vs. +18% in 2Q11.) CPC inflation has continued in 3Q, and was especially high across retail and consumer electronics, and across int'l markets (~+50% Y/Y acc. to one source for APAC). This was driven by redeployment of ad$ for H211 after a pullback in 1H11, higher bids on generic keywords (Google Instant) and better conversion rates from ongoing algo/UI tweaks." Jefferies is modeling for 12 percent year-over-year growth in CPCs.
Jefferies also sees Google potentially being impacted by foreign exchange headwinds, which may take as much as 9 cents per share from earnings in the quarter.
Key issues investors should pay attention to include it's Motorola (NYSE: MMI) strategy beyond patents, regulatory issues, and Google+ metrics.
Jefferies is looking for revenue of $7.2 bllion and earnings of $8.76 per share. The Street currently expects revenue of $7.19 bllion and earnings of $8.74 per share.
Click here for more analyst color on Google, or here for a ratings history.
Google reports results on October 13th.
Google is 1.7 percent better Monday morning.
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