Assuming more investors wouldn't have rushed to buy more Google stock just because it split, the company's market value probably wouldn't have changed from its current level.
There is little dispute among analysts that Google appears well positioned for many years of prosperity for these reasons:
— Its Internet search engine remains the hub of the Web's biggest marketing network;
— Its YouTube video site has established itself as an increasingly attractive advertising vehicle and could broaden its reach as more people get Internet-connected televisions;
— Its Android software is running on more than 600 million smartphones and tablet computers, creating new advertising opportunities.
Google already dominates mobile advertising, with its U.S. revenue from that business expected to approach $4 billion this year, up 84 percent from nearly $2.2 billion in 2012, according to the research firm eMarketer. Google commands a 55 percent share of the mobile ad market, based on eMarketer's estimates. Google doesn't disclose how much of its $44 billion in annual worldwide ad revenue comes from mobile devices.
Some investors have raised concerns that mobile ads have been commanding lower prices than ads on regular Web pages, reducing the average rate for ads. The company is trying to address that with a revamped ad system that will prod more marketers to buy mobile ads when they are creating campaigns for desktop and laptop computers. That, Google hopes, will raise demand and thus prices.
Opinions about Google weren't as upbeat a few years ago. Although Google weathered the Great Recession better than most companies, its revenue growth slowed and its stock plummeted to as low as $247.30 near the end of 2008.
Things looked so bleak in 2009 that Google took the rare step of re-pricing stock options that had been doled out to its employees to give them a chance to make more money when the shares rebounded. The program allowed Google workers to swap their old stock options for new ones with an exercise price of about $308. The employees who have held on to the re-priced options would make nearly $500 per option if they were to exercise them now.
Although he didn't receive any of those re-priced options, Schmidt is poised to pocket a huge windfall by selling 42 percent of the shares that he owns in the company during the next year. The 3.2 million that Schmidt, now Google's executive chairman, has earmarked for sale are currently worth about $2.6 billion. Google says the stock sales are part of Schmidt's strategy to diversify his investment portfolio so less of his wealth is locked up in the company.
Even after the economy snapped out of the recession toward the end of 2009, Google's stock began to lag the rest of the market. Investors began to wonder if the company was losing its competitive age as it morphed from a hard-charging startup to giant organization with thousands of employees working in dozens of offices scattered around the world.
At the same time, Facebook was emerging as the Internet's fastest growing company in a meteoric rise. The social networking company had some people convinced it would eventually become a more important advertising vehicle than Google's search engine.
Perceptions have changed since Page became CEO. Under Page's leadership, Google has streamlined its decision-making and operations while closing dozens of its less popular services. It established its own toehold in social networking with the 2011 introduction of Google Plus.
Meanwhile, Facebook Inc. so far hasn't lived up to the hyperbole that that made its initial public offering of stock one of the biggest in U.S. history. Since going public at $38, Facebook's stock has sunk 24 percent.
By contrast, Google's stock has never slipped below its August 2004 IPO price of $85.
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