Google: the price is right It is nice to see rational exuberance once in a while. Google's third-quarter results, released on Thursday night, sent the shares up 13 per cent, breaching $1,000. About time. The price jump might look odd, in as much as the numbers Google presented look a lot like those that it rolled out in preceding quarters. Revenues (excluding Motorola), grew at 19 per cent (previous four quarters: 20, 23, 22 and 19 per cent). Once again, increased volume made up for falling prices in search advertising. Operating margins were dead in line with their average over the past year. So why the big jump? Two reasons. First, poor results from other technology companies had the market braced for bad news. Ebay - another company tied tightly to ecommerce - told the market to expect soft holiday sales. IBM's sales growth is slowing to the point where even those who buy into the company's focus on profits rather than sales are beginning to get jumpy. Shares of these two beautifully-managed companies fell 4 per cent and 6 per cent, respectively, after their earnings announcements this week. Second: the stock was cheap. At $1,000, the shares change hands at 23 times this year's expected earnings per share. That is not an obvious bargain. But there are precious few very large companies that are growing briskly. Here is the list, drawn from S&P Capital IQ data, of companies with enterprise values over $100bn and revenues that grew faster than 15 per cent over the past year (without significant help from acquisitions): Google, Facebook, Qualcomm, Amazon, Samsung Electronics and (surprisingly) Honda. For Facebook and Amazon one pays a multiple of earnings that would give a mountain goat vertigo. Samsung's growth is slowing quickly and, like Qualcomm, it is right in the middle of the viciously competitive mobile device market, where (as Apple investors have discovered) growth can be fleeting. Honda is an interesting stock but is getting help from a weak yen and its growth is flattered by easy comparisons. Google, as a company, has strong organic growth and high barriers to entry. As a stock, it has scarcity. The price is right.