When tech stocks go out of favor, it’s not just the high-growth momentum names that take it on the chin. Some of the larger tech companies that actually generate positive earnings are sold off in the madness.

This has happened to one of the more innovative companies in the market. Since reporting earnings last month, shares of Google (NASDAQ:GOOG) are down 5%. The NASDAQ index is flat over that same time period. The tech giant did miss earnings and revenue consensus estimates, but Google remains the top tech stock every investor should own.

It’s not everyday investors are given a great buying opportunity in a mega-cap stock with a $350 billion market cap. Shares of Google are now trading at a P/E of under 17 based on next year’s earnings estimates. That’s fairly cheap for a company that dominates its market. A company with a dominant market share generally trades at a premium to its peers.

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But the other part of the story is that Google is a cash-rich company. Its debt is negligible when compared to its cash pile. It has enough cash to cover over 15% of its market cap. Excluding cash, Google trades at a P/E of 12.8 based on next year’s earnings.

But Google’s ability to navigate the migration from desktop to mobile advertising is being questioned by some investors. During the first quarter, Google’s cost per click (ad prices) fell 9% year-over-year. Paid clicks grew by 26% year-over-year, but the growth was slower than the 31% the company posted in the fourth quarter.

The decline in its cost per click has been in decline for a number of quarters as lower yielding mobile ads make up a larger part of Google’s ad revenue mix, versus the higher yielding desktop ads.

Google is still the dominant force in the U.S. search market, owning nearly 70% of the market share. And it’s also the top search engine in Canada, Latin America, Europe and most Asian countries. Thus, it has plenty of leeway when it comes to figuring out the shift from desktop to mobile advertising.

In the meantime, it has other products that it can look to monetize.

Google has already unveiled a mobile operating system for wearable devices, called Android Wear. Google Glass is expected to go into commercial production this year. And don’t forget Google owns the world’s largest video sharing site, YouTube. The company also has a large opportunity to eventually monetize this platform.

Just a few weeks ago Google acquired Titan Aerospace, which is a developer of solar-powered drones. Google and Facebook (NASDAQ:FB) were in a bidding war for Titan, but Google won out. Google plans on using these drones to provide wireless interest to remote areas, as well as collecting Google Maps images.

Google and Facebook are taking a bit of a different approach than Apple (NASDAQ:AAPL). Google and Facebook are not afraid to make strategic acquisitions and spend cash to develop products that are outside their core offerings.

Apple appears to be content with sticking to the mobile/computing space. This has proven to be a sound strategy, but it doesn’t make Apple a growth story. Hence the reason Apple is using its excess cash to pay a 2.2% dividend yield and is increasing its share buyback program.

Google will continue to look for the next major trend as part of its strategy.

Earlier this year Google made a strategic acquisition to further integrate itself into people’s lives. Its $3.2 billion acquisition of Nest Labs (the smart thermostats maker) gives the tech giant a larger presence in the smart home market. Google can now begin to track and sort data about people’s habits in the home. It can then sell that data to servicers of the home industry.

At the beginning of the year Google announced plans to shed the Motorola division by selling it to Lenovo for $2.9 billion. The Motorola sale will further boost Google’s cash pile and give it more ammo to make key acquisitions.

This includes making a splash in the mobile payments space.

Its Google Wallet has struggled. But there is speculation that Google could buy up the mobile payments company Square. With nearly $60 billion in cash, Google could easily acquire Square at the company’s reported $5 billion valuation. For $5 billion, Google would get a payments company that processed $20 billion in transactions last year.

So while the first quarter results were below expectations, Google is still a long-term growth story.

It has a dominant position in search and it has a suite of products that caters to millions of users, including Android, Chrome, and Gmail. Google will continue to make speculative projects a larger part of its business model. And with its war chest of cash, Google really is the top tech stock every investor should own.

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Published by Wyatt Investment Research at