NEW YORK, Jan 21 (Reuters) – Investors brushed aside concerns
that a surprise shake-up at Google Inc (NASDAQ:GOOG) putting co-founder
Larry Page back in the top job would prove a distraction at a
critical time and focused instead on the company’s stellar
Profit and revenue rose 29 percent in the quarter and at least
twelve brokerages raised their price targets on the stock
following Thursday’s results.
But across technology circles the move by Google — founded
during the first dot-com boom — to replace CEO Eric Schmidt with
the 38-year-old Page left some wondering how the search giant
would deal with middle age.
"Founder becoming CEO … Is this like a Steve Jobs
returning or a Jerry Yang returning?" Chris Dixon, a technology
veteran who has invested in Skype and Foursquare, tweeted.
Steve Jobs returned to Apple Inc (NASDAQ:AAPL) in the 1990s to save
the company he founded from near death. Yahoo Inc’s (NASDAQ:YHOO) Jerry
Yang made a similar return, coming back to his Internet company
during a troubled stretch — but has failed to restore its
Starting April, Google’s Page will take over as chief
executive, a move the company hopes will streamline its
decision-making process amid fresh competition from Facebook and
Shares of Google were up $2.53, or 0.4 percent, at $629.30
after opening at $639.58.
"It is important to note that although the titles have
changed, the core team remains the same … this new team
structure makes a lot of sense and could result in faster
decision making," JP Morgan analysts led by Imran Khan said.
Some analysts believe that Google’s stock could gain
another 20 percent from current levels.
Brokerage UBS said it was bullish on Google’s long-term
prospects and expects the company’s focus on its emerging
display network business, YouTube, Android and enterprise
customers to deliver healthy returns in 2011.
Fourth-quarter operating margins were slightly weaker than
expected at 53 percent on higher sales and marketing expenses.
JP Morgan’s Khan, who lowered his 2011 operating margin
estimates by less than a percentage point to 52.4 percent, said
the expenses are necessary to promote future growth.
Evercore Partners, however, said it was still concerned
about Facebook’s present growth trajectory and deepening
integration with third party sites.
Investors have speculated that Facebook could cut into
Google’s business if advertisers shift to the social network.
Shares of the Mountain View, California-based Google closed
at $626.77 on Thursday on Nasdaq. They have risen 16 percent
since Google reported third-quarter results mid-October and are
up almost 45 percent from its 52-week low of $433.63 touched in
(Reporting by Paul Thomasch in New York and Sayantani Ghosh
and Mary Meyase in Bangalore; Editing by Joyjeet Das; Editing by