Google shares have dropped almost 11 percent in the last month. So should investors still consider buying the search engine giant? Steve Weinstein, senior analyst at Pacific Crest Securities shared his insights.
“The core search business continues to do well and putting up solid growth,” Weinstein told CNBC. “I’m also looking at traction with Google and new initiatives such as their mobile businesses and display businesses as those become more visible to investors, you’ll see people wanting to buy Google shares again.”
Weinstein has a “buy” rating on Google and has a $720 price target.
According to latest reports, social networking site Facebook surpassed Google to become the most visited U.S. site, demonstrating a change in how users search for content. However, Weinstein said the social networking sites don’t pose a threat to Google.
“Right now, Facebook is about communication with friends and peers and not necessarily a source for finding information—that’s what Google still stands for and what people still do,” he said.
“It’s somewhat of a leap for a social networking site to become a source of that information," he continued. "If you look across the Internet space, a lot of site that have aggregated a lot of traffic have not been able to leverage that into new business, let alone the search business, which is complicated.”
More Market Intelligence:
CNBC Data Pages:
Google Competes With:
Weinstein does not own shares of Google.