BoomBustBlog Research Hits Another One Out the Park! Google up nearly 10% after hours, true blowout earnings unlike JPM

Bloomberg reports: Google Profit Beats Estimates as Companies Boost Ad Spending; Shares Climb

Oct. 14 (Bloomberg) — Google Inc.,
owner of the world’s most popular search engine, said third-quarter
profit increased as businesses spent more on advertising to attract
online consumers. The shares jumped in after-hours trading.

Net income rose 32 percent to $2.17 billion, or $6.72 a share, from $1.64 billion, or $5.13, a year earlier, Google said on its website. Profit excluding some items was $7.64 a share, exceeding the $6.68 average of estimates compiled by Bloomberg.

Google is benefitting from increased
spending on search- based ads as it pursues opportunities in mobile
communications and display advertising. Online spending is expected to
account for 15 percent of total U.S. advertising this year, up from 12
percent in 2008, according to EMarketer Inc. in New York.

“The underlying strength in the core search business basically means advertisers are spending healthily on search,” said Clayton Moran, an analyst at Benchmark Co. in Boca Raton, Florida, who recommends buying the shares. “They beat on the top line and also on the bottom line.”

Google, based in Mountain View, California, climbed as much as 9.6 percent in late trading to $592.82. It closed at $540.93 at 4 p.m. on the Nasdaq Stock Market. The shares have dropped 13 percent this year.

Excluding revenue passed on to partner sites, sales were $5.48 billion, topping analysts’ average estimate of $5.26 billion.

…

Display, Mobile

Google is seeking new revenue
streams, including searches on mobile phones. Its Android software has
surged in popularity among consumers, overtaking Research In Motion Ltd.’s BlackBerry to become the top smartphone operating system in the U.S. in the second quarter, according to research firm Gartner Inc.

Display advertising at Google is
growing as its YouTube video-watching service attracts more marketers.
The company said in May it had boosted the number of display advertisers
10-fold on YouTube.

“Our newer businesses — particularly display and mobile — continued to show significant momentum,” Chief Executive Officer Eric Schmidt said in a statement.

Display revenue is on pace to top $2.5 billion annually, Jonathan Rosenberg,
senior vice president for product management, said on the conference
call. Mobile-ad sales are on track to exceed $1 billion annually, he
said.

This is pretty much verbatim as we predicted it, and the stock and option prices are performing accordingly…

I strongly urge all paying subscribers to read and reread the longest forensic analysis that I have ever released (@63 pages): Google Final Report, as well as the An Analysis and Valuation of Google’s Android and AdMob. Professional subscribers are strongly urged to play with all of the market and valuatin models that we have to offer (click here to subscribe):

• Google Valuation Model (pro and institutional).
• Smartphone Market Model – Blog Download Version – all paying subscribers
• Mobile Operating System Market Share Model – all paying subscribers – This model is key to showing the trends across operating systems, and not just handset manufacturers.

This carries on with the strong performance of the Research in Motion
Analysis, which I am now giving away for free since it has hit our
initial price point, see The Research In Motion Forensic Valuation and Analysis is Released to the Public. … and on that note, here is the breadcrumb trail of blog posts that led up to this point, starting June 21st, 2010:

iSuppli Continues to Validate BoomBustBlog’s Original Thesis: Android as the Viral Game Changer!

More on the Creatively Destructive Pace of Technology Innovation and the Paradigm Shift known as the Mobile Computing Wars!

1. There Is Another Paradigm Shift Coming in Technology and Media: Apple, Microsoft and Google Know its Winner Takes All
2. The Mobile Computing and Content Wars: Part 2, the Google Response to the Paradigm Shift
3. An Introduction to How Apple Apple Will Compete With the Google/Android Onslaught
4. Don’t Count Microsoft Out of the Ultra-Mobile Computing Wars Just Yet
5. This article should drive the point home: An iPhone 4 Recall Will Hurt Apple More By Opening Additional Opportunity for Android Devices Than Increased Expenses
6. A First in the Mainstream Media: Apple’s Flagship Product Loses In a Comparison Review to HTC’s Google-Powered Phone
7. After Getting a Glimpse of the New Windows Phone 7 Functionality, RIMM is Looking More Like a Short Play
8. RIM Smart Phone Market Share, RIP?
9. Android is gaining preference as the long-term choice of application developers
10. A Glimpse of the BoomBustBlog Internal Discussion Concerning the Fate of Apple
11. Math and the Pace of Smart Phone Innovation May Take a Byte Out of Apple’s (Short-lived?) Dominance
12. Apple on the Margin
13. RIM Smart Phone Market Share, RIP?
14. Motorola, the Company That INVENTED the Cellphone is Trying to Uninvent the iPad With Android
15. Android Now Outselling iOS? Explaining the Game of Chess That Google Plays in the Smart Phone Space
16. There
    Goes Those Fancy eBook Aspirations from Apple, Barnes and
    Noble, and Amazon: 100,000’s of FREE eBooks from the Public
    Library
17. How
    Google is Looking to Cut Apple’s Margin and How the Sell
    Side of Wall Street Will Enable This Without Sheeple
    Investor’s Having a Clue
18. Empirical Evidence of Android Eating Apple!
19. More of the Android Onslaught: Increasing Handset Revenues and Growth
20. Many More Black Eyes for the Blackberry? A Complete Forensic Analysis of Research in Motion
21. The BoomBustBlog Multivariate Research in Motion Valuation Model: Ready for Download
22. The Complete, 63 pg Google Forensic Valuation is Available for Download

Comments

[SamuelMaverick]

Reggie, the keystone in your anaysis, apps, is weak, and is not the future paradigm in mobile communications.  More powerful phones / tablets = no need for apps in the near future.  Short term trading the apps are relevent, but long term trading they will be an achilles heel. 

[goldmiddelfinger]

I strongly urge all paying subscribers to read and reread the longest forensic analysis that I have ever released (@63 pages)

Reggie wrote a long report?

Ya think?