NEW YORK (AFP) — Google's stock price burst the 600 dollar barrier for the first time Monday after favorable reports on its business potential stoked investor appetite for its already pricey shares.
The Internet search giant's shares closed up 2.6 percent at 609.62 dollars after smashing through 600 dollars in morning trades. Its share price has now been multiplied by seven since its debut just over three years ago.
It latest price gains came after analysts at Bear Stearns, a Wall Street investment bank, said in a research report Friday that Google's stock could soar to 625 dollars by the end of the year.
The analysts said Google is continuing to gain market share in the highly competitive online search marketplace. They believe Google's stock price could strike 700 dollars by the end of 2008.
Other industry analysts are also ratcheting up their expectations for the Mountain View, California, based technology firm.
Analysts at Nollenberger Capital Partners said in report, also released Friday, that Google has been performing so well that it's prior earnings estimates for the company were likely too conservative.
"Beyond the near term there remains a wealth of untapped opportunity for Google in both the mobile advertising arena as well as in display advertising," the Nollenberger analysts wrote.
The upbeat assessments could not have come at a better time for Google which is due to release its third quarter earnings on October 18.
It reported profits of 925 million dollars in the second quarter and earnings per share of 2.93 dollars. Analysts expect its forthcoming profits to be even fatter.
Google makes the bulk of its money by selling online advertising. It collects lucrative revenues by charging advertisers every time an Internet user clicks on an advert displayed on Google's websites.
Its name has also become a verb, to Google, among computer users surfing the Internet for information.
Google has ballooned at breakneck speed since its founding by two former Stanford University students, Larry Page and Sergey Brin, into a multinational corporation with a market value of around 187 billion dollars.
Page and Brin incorporated Google in September 1998 using a garage in northern California as their first corporate base. Both men are members of Google's executive management group and have become billionaires since Google went public.
When the two founders took Google public in August 2004 its shares initially sold at 85 dollars. By the end of 2006, its stock had rocketed to 460 dollars, marking a staggering leap of 441 percent in just over two years.
The company has fueled its expansion through its own growth as well as mounting aggressive takeovers.
It is vying to take over online ad targeting company DoubleClick for 3.1 billion dollars, although the potential deal is being reviewed by government regulators.
Its growth is also being powered by its 2006 takeover of the popular video clip sharing website YouTube for 1.65 billion dollars. Google began running advertising on YouTube in late August.
Google announced a new initiative Monday with IBM which aims to promote new software development methods to better address large-scale computing. Several US universities are supporting the project.
Google started offering readers of its Internet news service direct access to AFP news stories in August after the two companies signed a licensing agreement.
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