Facebook shares jump on pair of ratings upgrades
By Alexei Oreskovic
SAN FRANCISCO Nov 26 (Reuters) - Facebook Inc (FB.O) shares soared more than 8 percent on Monday, reaching the highest level in four months after two Wall Street analysts upgraded their views on the social networking company.
New ads that appear directly within Facebook's newsfeed are set to boost revenue over the next 12 to 24 months, Sanford Bernstein & Co analyst Carlos Kirjner said in a note to investors on Monday. Kirjner raised his rating on Facebook to "outperform" from "market perform," and lifted his price target to $33 a share from $23.
Facebook, the world's No. 1 online social network with some 1 billion users, was also upgraded to "neutral" from "sell" by brokerage firm BTIG.
Facebook's shares rose some 8.1 percent, or $1.95, to $25.96 in midday trading.
Facebook became the only U.S. company to debut with a market value of more than $100 billion, but its stock price dropped more than 50 percent after the IPO on concerns about the company's long-term money-making prospects.
"We think Facebook is on path to beat consensus revenues over the next 12 to 24 months," Kirjner wrote in his note.
"Facebook probably can increase the number of ad impressions per user, per day with limited chance of seeing material deterioration in the user experience," Kirjner said, adding that mobile advertising and the recently launched Facebook Exchange ad system would also help boost revenue growth.
Shares of Facebook, which had an offering price of $38, traded as low as $17.55 in September.
(Reporting By Alexei Oreskovic; Editing by Maureen Bavdek)
((Alexei.Oreskovic@thomsonreuters.com)(415 677 2511)(Follow Alexei on Twitter @lexnfx)) Keywords: FACEBOOK SHARES/
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