NEW YORK (AP) — Shares of Internet search engine Google Inc. fell in premarket trading Friday after it revealed that it got less money for each ad in the fourth quarter.
The stock was down $49.46, or 7.7 percent, at $590.11 per share in trading ahead of the market opening. The shares haven’t been below $600 in regular trading since Dec. 1.
Investors had expected that the surge of online holiday shopping in the U.S. would let Google charge more for its ads. Instead, the average price fell by 8 percent from the same time in 2010.
The results weren’t enough to make analysts change their minds about Google.
Analyst Youssef Squali said the numbers weren’t as bad as they looked. The volume of paid clicks was up 34 percent, higher than expected. And 2 to 3 percentage points of the 8 percent decline in price was due to the stronger dollar.
“We believe that the 9 percent stock price decline post close is an over-reaction to actually a decent quarter, buried under a lot of noise,” Squali wrote in a morning note.
Mark Mahaney at Citigroup also noted the currency effect. “A miss is a miss,” he wrote, but it wasn’t enough to change his positive view of the company and his “Buy” rating.
The relatively bearish Clayton Moran at Benchmark Capital made a more significant change to his model, taking his price target for Google shares from $700 to $625.
“We maintain a cautious view as European weakness likely persists and the US appears off to a slow start in 2012,” Moran wrote. He kept a “Hold” rating.
There was no immediate response to an email to Google for comment.