Investors are falling out of love with Google

NEW YORK (CNNMoney) -- Google's stock is exactly where it was in September 2007, and it has fallen 9% since Eric Schmidt announced in January that he'd be stepping down as CEO.

The problem, investors say, is that for every reason to believe in Google (GOOG, Fortune 500), there seems to be a counterbalancing reason for concern.

The company is growing rapidly, but antitrust battles are a threat to growth. Hiring increases could help create the next billion-dollar business, but the weight on margins scares some investors. New management should make the company more efficient, but near-term profits could suffer. And well-received product enhancements aren't enough to reduce some investors' worries about Facebook's threat to Google's business.

"There are many moving parts at Google that make it hard to assess [growth] on the revenue line, associated risk and competitive dynamics across its many markets," said Joel Achramowicz, analyst at Blaylock Robert Van. "These uncertainties are causing the market to remain circumspect with regard to the name 'Google.'"

Here's a closer look at what's bugging the search giant's shareholders:

Slowing growth: Google's stock has stalled even as the company has continued to grow.

Google will report results from its latest quarter Thursday afternoon. Sales are expected to have risen 25% and profit is forecast to have gone up 20%, according to a median estimate of analysts surveyed by Thomson Reuters.

That's pretty good for a company that's been around for more than a dozen years, and it would follow the previous quarter's more than 25% rise in both revenue and earnings.

Of course, that's far from the 40% growth the company had each quarter just a few years ago.

"When you program investors to get used to 40% each quarter, that's your mark," said John Scherr, analyst at Whisper Number. "Investors aren't looking for half of that."

Investors are worried that growth could slow even further. The company's all-but-an-exit from China doesn't help, but the biggest concern is that U.S. and European regulators have begun to investigate whether the company is a monopoly.

Google's purchase of flight data search company ITA, for instance, raised antitrust concerns at the U.S. Justice Department. It was eventually completed on Tuesday, but only after Google accepted steep concessions.

"Google's future ability to grow by acquiring companies is a worry," said Ken Sena, analyst at Evercore Partners.

That leaves shareholders wondering what to make of Google as an investment.

"Google is between a growth stock and a value stock; no-man's land for stock investors," said Aaron Kessler, analyst at ThinkEquity.

Expense growth with management change: New CEO Larry Page promised a return to the company's startup roots, and began by shaking up management and pledging to build out the company's key product areas. As a result, Page said the company would ramp up its capital expenditures and embark on the biggest hiring surge in Google's history.

That's potentially great news in the long run, since one of those investments could become the next Android (of course, it could also become the next Wave). But in the short-run, that means margins are going to get tighter -- a no-no with shareholders.

"Having a Google that's a little more willing to invest in what they have, in order to build out beyond search, will ultimately create shareholder value," said Heath Terry, analyst at Cannacord Genuity. "But that's not going to make the next few quarters look how they'd like."

Facebook competition: Facebook is now the most-visited site in the world, relegating Google to second place, according to comScore. And people spend significantly more time on Facebook's site than they do on Google.

Research by Citi analyst Mark Mahaney showed that Facebook's growth was not significantly denting Google's position as the top referrer on the Web.

But investors aren't completely convinced that Facebook and Google operate in separate worlds. Google's multiple failed social strategies also haven't done much to appease their fears.

"Facebook is now the leader in Internet viewership, and generally, dollars follow share," said Michael Hickey, analyst at Janco Partners.

Transparency: Some say the biggest problem with investing in Google is that the company is operating hundreds of products in dozens of markets, yet it sheds very little light on how those individual businesses are faring.

In a rare example of that kind of transparency , Google announced in October that its non-core businesses like display and mobile advertising are billion-dollar businesses. It also said YouTube isn't just bringing in significant revenue, it's also profitable.

Until that point, most analysts believed YouTube was losing money. The concern is that Google is a one-trick pony with search as its sole significant revenue stream.

Following the company's YouTube revelation in October, shares soared for three straight months, rising 15% until Google's January announcement that Schmidt was stepping down.

Convincing investors that its other products are performing well could yet again give Google's shares a healthy boost.

"These guys continue to put up numbers, but this is one company where the market is missing the forest through the trees," said Terry from Cannacord Genuity. "Google isn't getting credit for a lot of the things that they've done right."