Google buy

Analyst Henning Wagener of AC Research reiterates his "buy" rating on Google (GOOG.NAS).

According to AC Research’s research note dated June 6 and published this morning, the company has made another acquisition. Google is taking over server specialist PeakStream, a corporation that, among other things, develops software for server computers. The systems are designed to run on work stations as well as on servers. With this acquisition, Google is able to enhance its own technology. As for the financial details of the deal, the parties agreed to disclose no further information.

Moreover, Google announced a close cooperation with salesforce.com, a producer of customer management systems. Salesforce.com is offering internet based solutions for the administration of client relations. The core of the agreement is the integration of the AdWords Google platform into the Salesforce Edition customer management software. With the development of a joint software package, the companies want to address in particular smaller sized corporations with less than 200 employees. Among other things, the Salesforce Group Edition shall enable companies to directly launch ads in the search results lists via Google AdWord. The analyst believes that this cooperation makes a lot of sense, since it ill probably enable Google to further expand its customer base. At Wednesday’s closing price of $518.84 and a 2007 P/E ratio of roughly 35, the company’s stock still seems to enjoy a somewhat moderate rating, considering the continuing rather large growth potentials. With the cooperation with salesforce.com, Google is reinforcing its competition with Microsoft in the corporate software market, the analyst says. Here, with internet word, mail, and calendar functions, Google is now offering more and more alternatives to the Microsoft office software. Against this backdrop, Google is likely to be able to gain some additional market share at the expense of Microsoft in this segment. AC Research reiterates its "buy" rating on Google