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Benchmark Co. analyst Clayton Moran Monday morning cut his rating on Google (GOOG) to Hold from Buy, citing “indications of softening online ad trends.” Moran asserts that while Street sentiment has turned positive as economic indicators and online trends stabilized in April, “more recent online activity indicates a further pull-back by large advertisers.”:Moran writes in a research note that “corporate America doesn’t seem sufficiently convinced of a recovery yet to open the advertising floodgates.”

Moran contends channel checks find “a softening in online advertising trends.” He says visibility remains low and indicators for the June-August period are negative, “implying at least a pause.” He adds that “large advertisers appear to reducing commitments heading into the summer…we are hearing that April and May were solid relative to expectations but indications for June through August are poor, thus tempering recent momentum.”

Moran maintains a $430 target price on the stock.

GOOG closed down Monday $5.55, or 1.2%, to $438.77.

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Source: Google Downgraded on Softening Ad Trends