After being savaged by nearly every source that could pick up a pen, the Google IPO returned 600% in three years. So what does it mean that those same outlets are now bullish on Facebook? MoneyShow editor-at-large Howard R. Gold, also of The Independent Agenda, explores the sentiment heading into Friday's big offering.

When Facebook goes public on Friday, it will bring some real excitement to what has been a dull, anxious market.

At an estimated $16 billion, it will be by far the biggest Internet initial public offering ever, and individuals and institutions alike will snap up shares, if they can get them.

The big question, of course, is will they make money? Will this company—which already has raised its offering price to $34 to $38 a share and boosted the number of shares it’s selling—perform in line with great Internet stocks of the past like Amazon (AMZN), eBay (EBAY), and Yahoo (YHOO)?

We don’t know, of course, but that hasn’t stopped the financial media from spilling buckets of pixels on this topic.

And after reviewing many articles, I was surprised to find the tone fairly positive. Sure, writers have raised questions about Facebook’s valuation, its ability to grow revenues, and its capacity to compete in mobile computing, among other things.

But almost every piece I read acknowledged the company’s huge success and its dominant position in social networks. And the coverage of Facebook’s founder and CEO Mark Zuckerberg has been overwhelmingly favorable, if not fawning, with only a couple of snickers about his wearing a hoodie to the company’s New York IPO road show meeting.

Why was I so surprised? Because I also read dozens of articles about the last great Internet IPO, that of Google (GOOG) in August 2004. And the contrast couldn’t have been more striking.

The financial media’s take on Google’s IPO was unremittingly negative. I estimate 98% of the articles trashed the company, the unconventional Dutch auction IPO process, even its co-founders Sergey Brin and Larry Page. Writers were openly contemptuous of Google’s prospects, and warned investors explicitly not to buy.

The only case of that I’ve seen with Facebook was Steven Rattner’s piece in the Financial Times, which said: “Here is my advice: do not buy any.”

And Henry Blodget—yes, that Henry Blodget—cautioned potential buyers about a letter in which Zuckerberg wrote, “We don’t build services to make money; we make money to build better services.”

In an otherwise flattering profile in New York magazine, Blodget warned: “For short-term investors, the letter amounts to a three-alarm klaxon: ‘Don’t buy this stock!’” But he took a more balanced view of the stock elsewhere.

By contrast, when Google went public in August 2004, writer after writer tore into the fledgling company. The Motley Fool was typical: "This mania over its IPO, certain to come out 15 to 20 times sales and perhaps over 100 times earnings, just has me scratching my head. Great companies can have lousy stocks if you buy them at the wrong price. Given the excitement here, that's almost exactly what this promises to be."

Here’s Reuters: "The rich price tag being hung on Google's initial public offering has many financial advisors steering their clients away from the deal, turning off some of the very investors the Web search giant had hoped to attract. "

The Wall Street Journal’s “Heard on the Street” column picked up rumblings of institutional discontent: "With Wall Street counting down to Google's initial public offering of stock...some institutions, such as mutual funds and hedge funds, are expressing a measure of reluctance to bid a high price for the IPO."

NEXT: Trashing Google, Praising Facebook

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The Associated Press also shook its head: "All the glee and glamour surrounding Google's IPO is rapidly dissolving into feelings of dread and derision about the online search engine's long-awaited stock market debut."

USA Today indulged in some finger wagging, too: "The Google golden boys who could do no wrong as they built an Internet search-engine powerhouse have gotten a harsh lesson in the dangers of Hubris.com."

And Dow Jones Newswires added fuel to the fire: "High-tech executives aren't googly-eyed over Google's...initial public offering...The top executives of 20 US technology companies said they won't be participating in the much-anticipated auction, which is expected to attract thousands of investors and raise billions of dollars...Several expressed concern about the "hype" surrounding the offering as well as the unusual auction process Google is pursuing.

"I'm not buying," Apple (AAPL) co-founder Steve Wozniak told The New York Times. "Past experience leaves the taste that a few people—never ourselves—will make out the first day, but that it's not likely to appreciate a lot in the near future or maybe even the long future."

“A lot of the valley's smart money seems to see Google stock as a sucker's bet,” The Times concluded.

Sucker’s bet indeed. The stock went public through a controversial Dutch auction at a reduced price of $85, and closed the first day of trading above $100.

By January 2005 it had doubled, hit $470 a year later (for a 368% gain in less than 18 months) and reached an all-time high of $747 in November 2007. All in all, more than a 600% advance in a little more than three years. It closed earlier this week above $600.

How could so many have been so wrong? And what lessons does it hold for prospective Facebook investors?

First, the whole auction process through which Google went public was chaotic, and some silly distractions (like a last-minute Playboy interview with founders Brin and Page) made many investors think it was amateur hour. Facebook has gone the traditional IPO route, which no doubt has led the media’s many Wall Street sources to praise rather than trash the offering.

Second, the media and many experts completely underestimated how big the market for paid search would be and how thoroughly Google would dominate it.

Article after article warned of the competitive threat in search posed by Microsoft (MSFT) and Yahoo—Yahoo!—even as the latter was on the verge of a long, painful decline.

Finally, there was a fixation on valuation that caused people to lose sight of the forest for the trees. Yes, Google was expensive by traditional measures—it went public at 121 times trailing 12-month earnings. (Facebook could change hands at 100 times trailing earnings.)

But those criteria, while important, are more appropriate for value stocks, not what technology guru Geoffrey Moore calls “gorillas”—dominant companies in hypergrowth markets. Facebook is certainly a gorilla, Moore told me a few weeks ago. And Google may have been the biggest gorilla of all.

Financial journalists are good at asking tough questions and being skeptical when everyone else is euphoric. But they can be instinctively negative, tend to pile on, and are temperamentally unable to spot and embrace huge growth opportunities. That’s why they failed so badly with Google.

So, what do I think of Facebook? Yes, it is expensive, and yes, it’s going to face a challenge monetizing its huge audience. (And the news that General Motors (GM) won’t buy more ads on the site was a big setback.) But I believe the stock will do fine over the long term, although probably not as well as Google did.

Why not? First, because Google had a truly frame-breaking platform that was phenomenally profitable from the get-go, and Facebook’s business model is still evolving.

And second, the media doesn’t hate Facebook nearly as much as they did Google.

So, buyer beware.

Howard R. Gold is editor at large for MoneyShow.com and a columnist for MarketWatch. You can follow him on Twitter @howardrgold and read his commentary on economics and politics at www.independentagenda.com.