Another vote of confidence in Google’s (GOOG) business, this time from Barclays analyst Doug Anmuth, who raised his estimates for Google today and increased his price target to $575.
Why? In a note today, Anmuth explains:
- “Improving macro conditions, a stronger ad market, & FX tailwinds” will likely produce “better than expected results” over the next few quarters.
- “Checks” suggest improving pay-per-click ad business during Q3, especially retail and auto, and “we are more optimistic” on Q4.
- As marketers focus on ROI, that’s good for Google and search advertising.
As a result, Anmuth raised 3Q estimates to +5.1% Q/Q net revenues, up from +4.4% Q/Q previously, and raised 2010 and 2011 estimates about 4-5% on “continued improvement in PPC,” along with margin expansion.
He adds that formal net neutrality rules, if adopted by the FCC, are good news for Google longer-term.
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