Why Google Shares Popped

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: GOOGL  ) jumped more than 13% to record highs during intraday trading Friday following better-than-expected quarterly earnings results from the search juggernaut.

So what: Consolidated quarterly revenue rose 12% year-over-year to $14.89 billion, which translated to 21% growth in non-GAAP earnings per share to $10.74. For reference, analysts on average were expecting adjusted earnings of just $10.34 per share on $14.8 billion in sales. 

Now what: Google may be a highly technical, cutting-edge business with many moving parts, but CEO Larry Page weighed in to highlight the relative simplicity of their aspirations by saying, "We are closing in on our goal of a beautiful, simple, and intuitive experience regardless of your device."

To be sure, Google's efforts seem to be paying off handsomely, and nearly two dozen analysts promptly boosted their price targets above $1,000 per share.

With Google stock currently up more than 40% so far in 2013, shares might appear expensive at first glance, trading at 29 times last year's earnings and around 20 times next year's estimates. Even so, when you combine Google's solid earnings growth with the continued global migration toward Android-powered devices, I'm convinced that's a well-deserved premium for this solid, long-term-oriented business.

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