Google’s AdMeld Acquisition Might Finally Go Through

GOOG: Alphabet logo

Google’s (NASDAQ:GOOG) tryst with anti-trust regulators has been long standing, and the AdMeld acquisition was no exception. However, after intense scrutiny, the deal is expected to close soon, [1] giving a further boost to Google’s display ad business. This should help the company march ahead in a space that is increasingly being dominated by Facebook.

See our full analysis for Google’s stock

Rising Competition Would Have Eased Regulators

The prime concern with the AdMeld deal was that Google might be making the online advertising environment unfavorable for competition by building a big enough moat of resources to deter other companies. [2] Google clarified that it’s far from dominating the display ad environment, [3] which is corroborated by the fact that Facebook is expected to lead the display advertising space by the end of 2011. Even struggling companies like Yahoo and AOL have formulated an internal agreement to share their ad resources. The Department of Justice (DOJ) should be comforted by these developments, as competition is definitely on the rise.

Source: eMarketer

Having said that, AdMeld is a beneficial ad-optimization tool and promises to provide better monetization for Google’s display ads. The deal closure comes at a good time for the company, especially when it’s working to diversify beyond search, with a focus on developing quality content on YouTube, as well as aggressively expanding Google+.

We currently have a price estimate near $628 for Google’s stock, which is around 7% above the current market price.

Relevant Articles
  1. Alphabet Stock Outperformed The Street Expectations In Q2
  2. What To Expect From Alphabet Stock ?
  3. Alphabet Stock Lost 10% In One Week, What’s Next?
  4. What’s Happening With Digital Ad Stocks?
  5. Alphabet (Google) Stock Underperformed The Consensus In Q3, What’s Next?
  6. Alphabet (Google) Stock Missed The Street Expectations In Q2, What’s Next?

Understand How a Company’s Products Impact its Stock Price at Trefis

  1. AllThingsD: Google Looks Forward to an Early Christmas Present From Washington: An Okay for AdMeld []
  2. AllThingsD: Google Will Keep Washington Regulators Busy With $400 Million AdMeld Deal []
  3. Google Blog: An update on our AdMeld Acquisition []