UPDATE: BGC Partners Raises PT on Google Ahead of September Quarter Results

In a report published Thursday, BGC Partners analyst Colin W. Gillis reiterated a Hold rating on Google (NASDAQ: GOOG), and raised the price target from $810.00 to $850.00.

In the report, BGC Partners noted, “Google reports September quarter results on October 18th. We look for the following: 1) Can the core business of revenue from Google owned sites accelerate back to growth that exceeds 20%? The company has posted four consecutive quarters of growth below 20% in its core, a meaningful deceleration from the 35% YoY growth in the core that the company captured in 2011. We are estimating $9.23 billion from Google sites, growth of 19.5% YoY. We see the slowing core business as a one reason why Google is investing so heavily in new ventures as new products are needed to reignite revenue growth. 2) Can the losses at Motorola be trimmed, and is revenue still limp sequentially even with the launch of the Moto X phone? We estimate Motorola revenue of $997 million, essentially flat QoQ with the $998 million of revenue in the June quarter. We are unconvinced of Google's strategy with Motorola. 3) Will enhanced campaigns, which removes the ability for advertisers to exclude bidding on mobile clicks, reverse the downtrend in pricing? Click prices have declined for a startling 7 consecutive quarters, after posting 8 consecutive quarters of increases starting back in 2009. We ask the question, what if the impact of poorly converting mobile clicks results in sustained declines in click pricing even with enhanced campaigns? 4) Is the company going to continue to grow expenses faster than revenue? In the June quarter expenses grew over 26% YoY compared to revenue growth of 19.5% YoY.”

Google closed on Wednesday at $898.03.