(Reuters) - Google Inc's overhaul of its operating structure is an acknowledgement of the lack of transparency surrounding its disparate businesses and projects, analysts said, but it remains to be seen how much more the company will actually disclose.
Analysts and investors have long sought more granular detail on Google's capital spending and cash flow, as well as the financial performance of YouTube and Android.
Google said on Monday it would split into two reporting companies under a new holding company called Alphabet.
One will hold its core search and Web advertising business, and the other its newer ventures such as driverless cars and Internet-connected thermostats made by its Nest business.
Google shares were up 5.4 percent at $698.74 in early trading on Tuesday as investors anticipated - as MKM Partners analyst Rob Sanderson put it - "a new era of shareholder friendliness".
Still, Google did not say what details it would disclose.
"Should Google move to 'segment reporting' as referenced in its filing, we would expect to get revenues and expenses for the core and non-core businesses, which should help bring clarity to any profitability drag caused by its non-core assets and their trajectory," said Goldman Sachs analyst Heather Bellini.
J.P. Morgan analysts said fuller disclosure could make the market more accepting of Google's heavy non-core investments.
Some analysts also expect the split to mark the start of a more aggressive approach to expense management.
"While there are many details to be worked out, this could lead to a much nimbler and aggressive Google that can take on additional risks to compete with upstarts and existing Internet platform companies," Mizuho Securities analysts wrote in a client note, raising their rating to "buy" from "neutral".
Pivotal Research Group analyst Brian Wieser said capex and cash flow were particularly critical for Google.
But he noted that companies with multiple reporting segments usually did not break out such detail.
He also said it was "highly unlikely" that Google would end up as two publicly trading companies.
At least 14 brokerages reiterated their top ratings on the stock. Apart from Mizuho Securities, Stifel Nicolaus and Monness, Crespi, Hardt also raised their ratings to "buy".
Several analysts likened Google's decision to break into two reporting entities to Amazon.com Inc's move to start reporting revenue from its cloud-computing unit. Amazon's shares have risen by about a third since the company first broke out results for its cloud business in April.
Of 50 analysts covering Google, 43 have a "buy" or higher rating on the stock and seven rate it "hold." The median price target is $750.
Reporting by Tenzin Pema and Lehar Maan in Bengaluru; Editing by Ted Kerr