The tech star of the summer certainly has been Apple (NASDAQ:AAPL), thanks to its red-hot 18% run since the start of June.
At the same time, we’ve been treated to a calamitous sideshow of social companies — including Facebook (NASDAQ:FB), Groupon (NASDAQ:GRPN) and Zynga (NASDAQ:ZNGA), all of which have suffered grueling losses — hogging the spotlight.
Lost in the ruckus? Just poor ol’ Google (NASDAQ:GOOG).
That’s right — the tech giant whose Internet search likely led you to this article. The company whose Apple-esque 18% summer run has brought its worth to $224 billion, making it the S&P 500′s sixth-largest by market cap and worth almost five times as much as Facebook.
The company that should get just a little more attention.
Of course, Google’s main driver is its hugely lucrative search business, which currently enjoys a hefty 60% market share. That’s in part thanks to its top-of-mind brand (you don’t search, you “Google”), constant innovation, and a large number of advertisers that have built their marketing campaigns around the search engine.
Other companies like Yahoo! (NASDAQ:YHOO), Microsoft (NASDAQ:MSFT) and IAC/InterActiveCorp (NASDAQ:IACI) have tried to wear away at that big piece, but the efforts have been costly failures.
With the massive cash flows from its search business — which came to $4.3 billion in the latest quarter — Google has made some thoughtful investments and acquisitions over the years. For example, while Google still is working on the profitability aspect of its deal for YouTube, the site still has worth as the dominant platform for online videos, logging about 72 hours of video uploads per minute! On the profitability front, Google is moving YouTube into premium content, such as with online-only dramas and comedies, as well as things like coverage of the recent London Olympics.
Another important segment for Google is its extensive ad business. Through its DoubleClick division, the company is the No. 1 player in display ads. It’s also the leader in mobile ads — something that came from the acquisition for AdMob. That business should be a nice growth driver for years as advertisers continue to shift their budgets toward digital.
Google also is eying the huge market for local commerce — with Groupon stumbling, GOOG has a chance to wrest away some market share. To this end, Google has bought several companies — like Frommer’s and restaurant rater Zagat — which will provide premium targeted content and attract more users.
And while it’s still in the early stages, Google also is making a push into the cloud. GOOG already has 5 million customers for its business apps, and the company recently unveiled its Compute Engine, which will allow developers and businesses to use Google’s extensive infrastructure. This essentially is what Amazon.com (NASDAQ:AMZN) does with its Amazon Web Services platform, also a big success.
But perhaps the most promising business for Google is Android, which came from an acquisition in 2005. Google had the foresight to see that mobile would be the next mega-trend, and acted to ensure it had its own platform, keeping a level of control in its own hands.
Android currently sees about 1 million new activations per day (with more than 400 million total devices on the market), as well as 20 billion app downloads. And through its acquisition of Motorola Mobility, Google has an opportunity to monetize this huge platform with devices that are tightly integrated with the software — a strategy that has worked well for Apple.
And the stock itself? The valuation is reasonable, with GOOG sporting a P/E of 13 on fiscal 2013 earnings that are expected to grow 18%. That seems like a perfectly good level in which to participate in some of tech’s strongest businesses, including local commerce, mobile, the cloud and search.
More important, Google has leadership positions in all these markets, which should provide stable long-term growth and investor returns.
Tom Taulli runs the InvestorPlace blog IPOPlaybook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli. As of this writing, he did not own a position in any of the aforementioned securities.