Last year amid all the Google Inc. (NASDAQ: GOOG) hype which lead to predictions by analysts of it reaching $600, $700 and even more by last January, I felt compelled to contemplate What IS Google worth?. After all I was criticizing others for their nonsensical positions so I started questioning myself and shared my thoughts on the subject.

Google's closing price last Friday August 17, 2007 was $500.04 per share. It is about 10% off its high and seems to be holding up rather well in a very erratic stock market. To summarize my comments, I felt that Google would be worth $480 per share if it made its numbers (which it did) so I was off by 4.18%. I figured its trailing 12 months earnings at $12. AOL Money & Finance states the TTM as $11.78. It was guesswork, but it was pretty good guesswork.

Although I stated that it might be worth $480, and I think it is close to fairly valued now, I also wrote in my conclusion that I would be much more comfortable with a price around $440 per share if I was to be buyer and this is still the case. There is every likelihood that Google will be a good investment over the next 12 months if its earnings hold up, but it is not a place for value investors and there is not the margin of safety that would make me a buyer. In particular, the Google team also needs to show me that they are able to attain a high return on invested capital, and that has not been demonstrated yet.

Those of you who are new to BloggingStocks can check out my other stories and read Chasing Value or Serious Money to find more potential opportunities and verify my track record as well ---INCLUDING ANY BAD CALLS.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm.