MOUNTAIN VIEW -- If you bought any Google (GOOG) stock on its first day of trading nine years ago, you'd be 900 percent richer today, after a strong quarterly report sent shares in the Silicon Valley giant soaring Friday into the rarefied air above $1,000.
Google shares gained more than $122 in one day, before closing at the record-setting price of $1,011.41, as investors reacted to better-than-expected financial results that suggest the company is moving forward on CEO Larry Page's vow to give Internet users -- and advertisers -- "a beautiful, simple, and intuitive experience" on Web-connected gadgets of all kinds.
Skeptics say Google's flagship ad business isn't growing as fast as it used to, and the company faces continued challenges from shifting consumer habits and Internet rivals including Facebook, Twitter and even the video service owned by AOL. But Wall Street liked what it heard Thursday, when Page reported that Google's third-quarter revenue jumped 12 percent and profit was 36 percent higher than a year ago.
"We continue to be impressed," RBC Capital Markets analyst Mark Mahaney said in a report Friday.
At least two dozen analysts raised their price targets for Google on Friday, according to Thomson Reuters. Most cited a big jump in Google's advertising volume, including ads on smartphones and tablets as well as traditional PCs, and healthy upticks in the ad-supported YouTube video service, the Google Play digital store and sales of gadgets running Google's Chrome software.
The results "have given us increased confidence in our bullish thesis," said Carlos Kirjner of Bernstein Research.
Google sold stock for $85 a share in its initial public offering, though the price rose to just over $100 on its first day of trading in August 2004. While it's had ups and downs since then, the stock had gained 30 percent over the past year, before shooting up 14 percent Friday.
A stock that trades above $1,000 is a rarity. Among the few are Priceline, the online travel site, which closed Friday at $1,048.25 and Warren Buffett's conglomerate, Berkshire Hathaway, which is in the stratosphere at $175,400.
Share price isn't the full measure of company value, of course. Apple (AAPL) shares are trading at about half the price of Google, but Apple's market value -- the stock price multiplied by its number of shares -- is $462 billion, while Google's is about $337 billion. Among U.S. companies, only Apple and Exxon Mobil, valued at $385 billion, are worth more than Google.
Apple, however, has split its stock three times since it went public in 1980. So a share of Apple stock purchased that year would be worth $4,064 today.
Google has never split its stock, but the company has plans to do so. After shareholders objected in court, a settlement was announced this summer. If the court approves later this month, Google could issue nonvoting shares under a complex scheme that will cut the price by roughly half. That would send the stock back to mid-triple digits.
And while Google remains the leading seller of Internet ads, it faces competition from other companies offering new ways to reach consumers online. Google acknowledged that Friday, announcing a partnership in which Google's DoubleClick ad service will help advertisers buy space on Facebook as well as other sites.
Contact Brandon Bailey at 408-920-5022; follow him at Twitter.com/BrandonBailey.