Facebook Stock Rises as Ad Revenues Seen Climbing
Facebook Inc. (FB) climbed the most in seven weeks after Brian Wieser, an analyst at Pivotal Research Group, said the world’s largest social-networking website could step up revenue growth with ad sales.
The shares of Menlo Park, California-based Facebook increased 5.2 percent to $21.09 at the close in New York, and earlier touched $22.16 for the biggest intraday gain since trading began on May 18. The stock has slumped 48 percent since the company’s May 17 inital public offering.
“Revenue acceleration is almost certainly in the cards for Facebook,” Wieser said in a research report. Facebook’s plan to introduce real-time bidding for advertising on its site, a technology used by Google Inc. (GOOG) and other Web companies to more effectively target consumers, would add $400 million to advertising revenue in 2012 if it was used for the entire year, Wieser said. Mobile advertising will also contribute to sales growth, he said.
Before today, Facebook shares had slumped for five straight trading sessions after the company reported earnings that showed slowing growth.
Facebook, which hasn’t closed above the $38 IPO price since its first trading day, on July 26 reported second-quarter sales growth of 32 percent, down from 45 percent in the previous three months.
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