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Google's Search Business Gets Stronger with ITA Acquisition
4/13/2011 12:30:00 PM
The U.S Department of Justice recently approved Google's ( GOOG ) acquisition of ITA, with some conditions. This is a good news for Google as it further strengthens the company's dominant position in the online search advertising market, in which it competes with Microsoft ( MSFT ), Yahoo ( YHOO ), and AOL ( AOL ).
We discussed the implications of this deal in detail last year (see ITA Acquisition Helps Google in Online Travel Search ). We believe that the deal gives Google an edge over Microsoft Bing in the booming travel search market, as Bing currently provides a much better travel search experience. The acquisition also provides Google with a new revenue opportunity, as it can now license flight data to online travel agencies while negotiating for higher payments.
Our price estimate for Google stock , at $603 is roughly 5% above market price.