Google's shares soared to a new record high of $519 before falling slightly to finish trading at $518.84, a 2.3 per cent gain.
The price target on stock was raised by Stifel Nicolaus from $585 to $620, following the search giant's recent activity, which included the acquisition of FeedBurner.
Having recently joined forces with online software pioneer Salesforce.com, Google is expected to win over more and more advertisers and further boost revenue.
Analysts Scott Devitt and Marla A. Block revealed in a client note: "We continue to believe many of Google's initiatives will be "winner take all" over the long-term.
"Google has become the technology leader of this cycle and it has uniquely built its dominant franchise on consumer choice rather than previous positions that were built on customer lock-in."
Salesforce.com will now introduce a new version of its service so its customers can distribute their online advertisements through Google.
Marc Benioff, SalesForce.com's chairman and chief executive, told CNBC: "We believe in the end of software. We found a natural partner in Google who believes in the same thing.
"We're able to combine our two platforms to create a greater offering for customers who want to automate their businesses and at the same time take advantage of all this exciting new internet search and advertising technology from Google."
