Google gains on Yahoo fallout
Written on May 7, 2008
Google Inc. may benefit from the fallout between Microsoft Corp. and Yahoo Inc., an analyst said late Sunday while raising his price target on the Internet portal.
Goldman Sachs analyst James Mitchell raised his price target on Google (GOOG, Fortune 500) to $650 from $560, implying he expects the stock to rise about 12% over Friday’s $581.29 close.
Microsoft (MSFT, Fortune 500) had planned its acquisition of Yahoo (YHOO, Fortune 500) to let it better compete with Mountain View, Calif.-based Google.
In trying to stave off Microsoft’s advances, Yahoo went so far as to say it would outsource its trademark search engine to Google.
"Any search affiliate choosing a partner at this time may bias toward Google as the safe choice in an uncertain world," Mitchell said in a note to clients guaranteed approval cash advance loans.
Were Google to run Yahoo’s search engine, it would likely add about $300 million to net revenue and about $600 million revenue from capturing Yahoo’s current search affiliates, he said.
Mitchell rates shares "Buy."
Shares rose $22.71, or 3.9%, to $604 in premarket trading.
Filed in: marketing.