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After Hours Google Sell-Off, Buying Opportunity?

Google released earnings Thursday and the Street was far from thrilled.

Shares tumbled 5% in extended trade after the firm posted a profit that missed Wall Street expectations for the quarter, the first reporting period for the company since co-founder Larry Page returned to the corner office as CEO.

And clearly there is still a fair amount of anxiety about how Page intends to run Google. Page, 38, has long expressed his belief that Google should invest heavily in opportunities that may take years to pay off.

And on Thursday after the bell, analysts zeroed in on a 54 percent surge in expenses to $2.84 billion that offset a 29 percent jump in net revenue.

The jump in costs reflected a spending spree that included new hires to accelerate product development under Page.

In fact, Google plans to hire more than 6,000 people this year, after taking a record 2,000 on board in the quarter and raising salaries by about 10 percent across the board on Jan. 1.

"You got expenses growing faster than revenue and some people were caught by surprise by the willingness of the company to spend," said BGC Partners analyst Colin Gillis. "But Larry Page had already signaled pretty clearly that he was going to be driving up expenses."

By the numbers the Internet advertising giant reported first-quarter earnings of $8.08 a share. The company was seen earning $8.10 a share, according to a consensus estimate from Thomson Reuters.

However sales marched higher - for the most recent quarter sales rose to $6.5 billion, up from $5.07 billion last year.

So, is the sell-off an opportunity? Or should you stay away?

Instant Insights with the Fast Money traders

Karen Finerman thinks it's way too early to make either negative or positive judgments about the leadership of Larry Page. She thinks at the moment it's prudent to stay on the sidelines. "At the moment it's a value trap," she says.

Tim Seymour is a buyer of weakness. "I'd stop out at $555 but it's still a growth stock and it's priced very well," he says.

Guy Adami agrees that Google is worth a flier. "If you're a long-term investor this isn't a bad entry level," he says.

Joe Terranova reminds the desk that typically June is a weak quarter for the company. "Why not wait," he counsels. He thinks you'll be able to get it cheaper.

Strategic investor Ryan Jacob is bullish. "I think this is a good time to add," he says. "At these prices it's a good opportunity."


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Trader disclosure: On April 14, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Adami owns (AGU); Adami owns (GS); Adami owns (INTC); Adami owns (MSFT); Adami owns (NUE); Adami owns (BTU); Adami owns (C); Finerman and Finerman's firm own (AAPL); Finerman and Finerman's firm own (BP); Finerman owns (C); Finerman and Finerman's firm own (CVS); Finerman's firm owns (HAIN); Finerman's firm owns (HPQ); Finerman's firm owns (JPM) and (JPM) leaps; Finerman owns (JPM); Finerman and Finerman's firm own (MSFT); Finerman's firm owns (TGT); Finerman's firm owns (UNG); Finerman owns (USO); Finerman's firm owns (WMT); Finerman's firm is short (IWM), (MDY), (SPY), (XRT); Finerman's firm is long S&P 500 puts; Finerman's firm is long Russell 2000 puts; Finerman's Firm Owns (BAC) Leaps; Terranova owns (JPM); Terranova owns (VRTS); Terranova owns (V); Terranova owns (BX); Terranova owns (GS); Terranova owns (UPL); Terranova owns (HOC); Terranova owns (TCK); Terranova owns (BAX); Terranova owns (OXY); Terranova owns (XOM); Terranova owns (AKAM)

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Accounts Managed by Kanundrum Capital are long SLV calls
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For Ryan Jacob
Jacob Internet Fund Owns (GOOG)
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