Google Fulfills Net Promise

The Street

By James J. Cramer
RealMoney.com Columnist
12/13/2005 7:42 AM EST


Google (GOOG:Nasdaq - news - research - Cramer's Take) fascinates and repels people. It repels because skeptics can't figure out how a company that makes nothing has a $120 billion valuation; it fascinates because no matter how high the stock goes, it seems to stay cheap at least when compared to so many other stocks.

As I look at it, I keep thinking that in Google you have the fastest growing and most lucrative company on earth, one that is a cannibal to all media, that offers viewers and advertisers the single greatest experience in the world: the ability to have all information at your fingertips at a cost of having to look at an ad for something that you actually might need.

I am focused on the company in part because I am talking about it on the "Today" show this morning -- that's not something that typically happens to just any old stock in the world. That's because Google is a phenomenon, a company that literally fulfills the promise of the age 1995-2000, when we figured that the Internet would revolutionize everything and we tried to revalue every company for its dot-com prospects. It turns out, however, that this company, and in some ways this company alone, captured the essence of what we thought could happen.

It is difficult to say that a stock that has just run 320 points is cheap, but we know that if Google can earn $9 a share in 2005, it doesn't get expensive until it trades at twice its growth rate, roughly $600.

What a story, a story worth telling, and owning, still.