Prudential Raises Google Estimates

Analyst Mark Rowen believes world's largest search engine will continue to gain market share

Prudential raised estimates for Google (GOOG ) and maintains its overweight rating

Analyst Mark Rowen says Google's $503 million net revenues beat his $467 million estimate and its 70 cents third-quarter pro-forma earnings per share easily surpassed his 53 cents estimate and 54 cents consensus. He believes Google continues to gain market share in Sponsored Search advertising, as third-quarter ad revenue, excluding traffic acquisition costs (TAC), grew 107% year-over-year, significantly outpacing Yahoo!.

Rowen believes investing in Google is, in effect, an ownership stake in the company with maximum exposure to online advertising market's fastest growing format. He raises $2.22 2004 earnings-per-share estimate to $2.62 and $2.91 2005 to $3.67. He raises his $130 target to $200.