Wall Street analysts seem to have a change of thought on the Facebook stock as they are slowing gaining back that initial investor confidence they had back in May when the company went public. Facebook shares surged to a four-month high after analysts at Sanford C. Bernstein & Co. and BTIG upgraded the stock.
Marking the highest close since July 26, shares of the social networking giant gained 8.1 percent to $25.94 at 4 p.m. in New York. The current surge also marks a 50 percent increase in its share values since touching a low of $17.55 in early September. Facebook's recent strategic shift of focus to mobile advertising seems to have paid off as there is a new-found expectation among the sceptics now.
Bernstein Research analyst Carlos Kirjner said, in his research report, that Facebook will likely beat Wall Street's revenue expectations over the next 12 to 24 months. Kirjner estimated that Facebook's revenue will hit $6.98 billion in 2013, which is nearly 9 percent higher than the average analyst expectation. Citing that its mobile advertising will drive revenue growth, Kirjner upgraded Facebook's stock to "Outperform" from "Market Perform," The Washington Post reported.
Brokerage firm BTIG advanced its Facebook rating to "neutral" from "sell," saying that the social networking site's mobile-advertising strategy will beat the expectations at its fourth-quarter results.
