Google Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Google (Nasdaq: GOOG  ) soared more than 10% in intraday trading today after crushing Wall Street's estimates for third-quarter earnings and revenue.

So What: The pop appears due to skeptics' reversing themselves. These are the traders and short-sellers who've argued Google doesn't benefit from giving away the Android smartphone operating system, even as it's putting pressure on Apple (Nasdaq: AAPL  ) and Research In Motion (Nasdaq: RIMM  ) by attracting the largest share of new U.S. smartphone buyers.

Now What: While the majority of Google's revenue is still derived from Web searches, Android, Google TV, YouTube, Google Apps, and related services are catching on as consumers become accustomed to cloud computing. As investors, we want to see these services gain traction so it's encouraging to see that Android and the AdMob mobile network Google acquired are now on track to produce $1 billion in annual revenue. So long as this continues to be a growth segment -- and there's no reason to believe it won't be -- Google remains a solid buy.

Interested in more info on Google? Add it to your watchlist here by clicking here.

True to its name, The Motley Fool is made up of a motley assortment of writers and analysts, each with a unique perspective; sometimes we agree, sometimes we disagree, but we all believe in the power of learning from each other through our Foolish community.

Apple is a Motley Fool Stock Advisorselection. Both our Motley Fool Inside Value and Motley Fool Rule Breakers services have suggested subscribers but shares of Google. Try any of our Foolish newsletter services free for 30 days.

Fool contributor Tim Beyers is a member of the Rule Breakers stock-picking team. He had stock and options positions in Apple and a stock position in Google at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. The Motley Fool owns shares of Apple and Google and is also on Twitter as @TheMotleyFool. Its disclosure policy is at least 10% better than other disclosure policies.


Read/Post Comments (0) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1333822, ~/Articles/ArticleHandler.aspx, 10/1/2014 12:16:39 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement