Sanford C. Bernstein analyst Jeffery Lindsay has increased his price target 30% for GOOG to $600, on the back of increasing RPCs (revenue per click) that it expects to dovetail with the recovering economy. He estimates Google’s growth to reach 7% for 2009, almost double that of Reuters Estimates’ aggregate analyst prediction of 4%.

Lindsay, in a note to his clients, expects advertiser competition–reflected in RPC–to remain weak through the second and third quarters, but he expects a healthy rebound that will boost Google’s YOY revenue growth to 14% in the final quarter. His estimation completely depends on the recovery of the economy and advertisers’ zest for online advertising to grow their businesses.

Google’s ability to develop inventory has sustained through the downturn–click volume grew 17% YOY in Q1 2009. The weakness has been in RPC, which has taken the steam out of Google’s search revenues.

The market, maybe a bit hungry for some good news from The Google, increased $5.89 in afterhours trading from a Thursday night close of $396.61 to a Friday morning opening price of $402.50. At the publication of this post, GOOG is trading at $407.98 (a 20 minute delay, naturally).

This entry was posted on Monday, May 11th, 2009 at 3:08 pm and is filed under Online Advertising. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.