Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) is really an undervalued growth story, says a recent research note from Bernstein Research.

Google

Bernstein is infatuated with Google for good reason.  The firm bestowed on the tech giant its “Best of Bernstein” label, making it a top pick at the firm.

Google’s search engine revenue to grow further

Bernstein notes that there is still much more growth in search engine revenue, Google’s core business, but it is that core that is being overshadowed by “optionality on promising businesses hiding in the other revenue line,” the report highlighted.

Bernstein expects Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) revenue to grow 20 percent in 2015 and thinks the stock price has the same growth potential. This growth will come in search, but almost more significantly Google’s future growth and upside could come from any number of projects entirely unrelated to search.

Strong growth drivers

Revenue in areas not related to search are poised to grow at “high double digit rates” for the next few years, the report notes.  In the intermediate term, Google play and Google cloud will be strong drivers of growth. The report noted that Google’s “nascent enterprise cloud businesses” could grow from close to $500 million in revenue in 2013 to several billion in revenue over the coming years.

But that’s not all.

“We think one should expect some of Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL)’s longer term investments and initiatives, e.g., in local advertising, in mobile-enabled offline payments, in Google Fiber, in Glass, or in self-driving cars to succeed,” the report said.  In fact, the these could become multi-billion dollar businesses worth tens of billions of dollars in several years from now, according to Bernstein’s best case scenario.

Google Fiber offerings

The report notes Google Fiber, which is offering a low cost alternative for high speed internet access – competition for the controlling cable companies as they set to fix the market by providing preferred speed access to those who have the means to pay for the privilege of a fast internet. “Google Fiber is likely to be value creating. In fact, data we have collected in some of Google’s early markets suggest the early trajectory of the business is much better than we had expected,” the report notes.

Comparisons of Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) to Facebook Inc (NASDAQ:FB) might be noteworthy.  Google is much less dependent on its “core” business than is Facebook and as a sidebar is engaged in business endeavors that work to assist their users and improve society. Google fiber and offering a choice against the controlling cable / telcom monopoly is one area this shows.  But another area, noted in the report, is Google’s moves to prevent pirate software installations that don’t utilize proper permissions. There is no direct profit motive in this non-revenue generating activity. It just makes the Internet safer for Google’s users.

Google vs Facebook

Contrast Google with Facebook, which is significantly dependent on its core business that could be declining in “cool” among a younger target audience.  Facebook, for its part, continues to be embroiled in privacy scandals and censorship issues.  Facebook appears not be treating their user as a valued asset but rather as a milking cow that it attempts to suck dry.

The ultimate relative value play on several levels could be long Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) and short Facebook Inc (NASDAQ:FB) – and that doesn’t just pertain to the stock price.