Google (GOOG): Back to $300

Google (NASDAQ: GOOG)'s shares closed down at $381 Monday. That is against an all-time high of over $747. They may have much further to fall.

According to Thomson/First Call, analysts expect Google's revenue for the calendar fourth quarter to rise 32% and EPS to go from $4.43 last year to $5.30 in the quarter that ends in December.

Google's stock price early this year was fueled by a 51% increase in revenue in Q4 2007. EPS per diluted share rose from $3.29 to $3.79.

Can Google grow well over 30% again in the teeth of a recession that could badly hurt many of the companies large and small who use Google's AdSense marketing program to drive business? In the current credit crisis, Google could be hurt much more than many investors imagine. There is already talk that companies that cannot get credit may miss payrolls and begin layoffs. That would certainly curtail marketing and spending for the holiday season.

If the present liquidity crisis gets worse, many companies will badly need cash just to keep their doors open. That makes finding money for advertising tough. Could Google's revenue growth rate fall below 20%? Or 15%? It is easier to imagine that with each passing day.

Google last traded below $300 in October 2005. The economy was OK then.

Douglas A. McIntyre is an editor at 247wallst.com.