Google Upgraded As Margins Begin To Stabilize

By Jennifer BootonMarketWatch Pulse

Google Inc. was upgraded to outperform from market perform at BMO Capital Markets on Thursday, hours before the company’s scheduled second-quarter earnings release. Analyst Daniel Salmon said the upgrade isn't a call on the company's imminent quarterly results, and doesn't represent a material change in view, but reflects increased confidence in upward estimate revisions in the coming quarters. BMO expects Google's margins to stabilize in the second half of 2015 and fiscal-year 2016 as it improves search growth and video ads on YouTube. Shares of Google traded up 1% premarket to $589.95. They have risen 7.5% over the last three months, outperforming the S&P 500, which is up just 0.1% over the same period.

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