Credit Suisse Investment Thesis On Google Play's New Ad Unit

In a report published Friday, Credit Suisse analyst Stephen Ju commented on Google Inc's GOOG GOOGL recently released new app promotion ad unit within Google Play. "We believe this is one of the more significant new ad units to be released by the company in some time and from a big picture perspective underscores once again our view that Google's presence via its multiple apps and services on mobile still remains undermonetized," Ju wrote. The analyst continued that until now, Google has ranked apps at the Play store based on user preference and relevance. But now, the new ad unit is similar to when the company first introduced sponsored links in the search engine results page. In other words, Ju noted that Google can not only generate platform revenue from Google Play, but this "opens the door" for advertising revenue as well as mobile app and content publishers will chose to use this new ad unit to drive app installs. Bottom line, Google is in a better position to address the promotional needs of the mobile gaming sector which is believed to be a $72 billion gross booking addressable market over the next five years. Shares of Google remain Outperform rated with a $700 price target.