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The Apple logo is shown on a stock ticker at the Nasdaq MarketSite, Tuesday, Aug. 21, 2012 in New York. Major stock indexes inched above four-year closing highs in early trading Tuesday. On Monday, Apple's surging stock propelled the company's value to $624 billion, the world's highest, ever. (AP Photo/Mark Lennihan)
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You've been hearing a lot about Apple's stock-smashing records. But with far less fanfare, Google's stock has also begun to roar, reaching an all-time high this week.

We may think of Google and Apple as fierce competitors, but investors have made plenty of room in their hearts for both of them. And rather than tear each other down, their rivalry has propelled them to new heights.

Their soaring stocks reflect the view that these two companies are dominant in the technology industry, breaking away from the pack of Silicon Valley also-rans.

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"If you look at what's happening in this decade, what is going to drive the companies and the stocks, it's all about innovation," said Trip Chowdhry, managing director of equity research at Global Equities Research. "The innovation velocity of Google and Apple exceeds anyone in the industry. Everyone else is yesterday's story."

Perhaps more staggering -- or frightening if your company is eating their dust -- is that in the short run, neither company seems to face meaningful competition, with the possible exception of Amazon.com, whose stock has also enjoyed a fantastic run.

But before I get into the reasons their stock is rising so fast, and what this all means, let's take a look at the numbers.


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Apple's stock closed Wednesday at $665.18, up 64.2 percent from $405.00 at the start of the year. Meanwhile, Google closed at $753.46, up 16.7 percent from $645.90.

While Apple has been strong all year, Google has only recently shifted into high gear. In the past three months, its stock has risen 33.4 percent. That compares with 16.8 percent for Apple.

There's one obvious reason Apple and Google have exploded this year:

"It's all about mobile," said Kevin Landis, of San Jose's Firsthand Funds. "I can't think of any company that has a better mobile strategy than those two."

Not only have Apple and Google massively exceeded all expectations but each has huge opportunities to grow even more.

Put aside Apple's stumbles of the past week, when it was criticized over the new maps in iOS 6, delays in shipment of iPhone 5s and for nicks in the aluminum casings of the of the new phones. Its stock slipped about 5 percent, but analysts largely shrugged that off.

"People are worried because they only sold 5 million units of the iPhone 5?" said Daniel Roarty, portfolio manager for technology at AllianceBernstein. "When you think about them selling hundreds of millions of phones in the next couple of years, there's not much to worry about there. The iPhone 5 will probably be the best-selling consumer gadget in history."

Roarty pointed out a metric that illustrated just how much the gap between Apple and its rivals has widened. Last year, analysts' consensus estimate was that Apple would do $109 billion in revenue this year. Now Apple is on track to do $156 billion.

Compare that with six other computing companies: Hewlett-Packard, Microsoft, Intel, Nokia, Dell and RIM, which Roarty dubbed "the mobility losers." Combined, those six companies are on track to report revenue that is $33 billion less than what was projected a year ago.

"The fact that Apple is overshooting that projection by $47 billion ... that's more than all but a couple of tech companies make in revenue annually," Roarty said. "They are just sucking the air out of the room."

Google has taken a different but equally impressive path.

The company came into this year facing uncertainty. Revenue for each time someone clicked on an ad was declining. There were doubts surrounding its acquisition of Motorola Mobility. And many thought its advertising model would be disrupted by Facebook. Even Google seemed nervous, redesigning many of its features and rolling out its own social network last year, Google+.

But that's all changed after Facebook's IPO, which raised doubts about that company's growth prospects, making it appear less a threat to Google. At the same time, Google's core search business exceeded expectations.

"The real question isn't, why is its stock where it is?" said Brian Wieser, an analyst at Pivotal Research Group. "The real question is, why was it down where it was? This is a company that produces so much cash, and without any real barriers to its growth. From a revenue perspective, it is firing on all cylinders."

And with most advertising yet to move online, Google still has a gigantic opportunity in front of it, both with its core search advertising business and in display advertising. On top of that, more than 1 million devices are being activated every day with Google's Android software, giving the company a better mobile foothold than just about any of its Web rivals.

Apple, meanwhile, will continue to sell unthinkable numbers of gadgets as it rolls out new versions of the iPad and iPhone, analysts say.

The biggest threat to either Apple or Google at this point might be themselves. As they grow ever larger, can they continue to meet demands from investors to continue their torrid growth, or will they stall? If not, the rest of the industry will be living in their shadows.

Contact Chris O'Brien at 415-298-0207 or cobrien@mercurynews.com. Follow him at Twitter.com/obrien and read his blog posts at www.siliconbeat.com.