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The
social media giant, which traded at just under $124 a share on
Friday, has seen a recent acceleration in growth in part because
of its increasing mobile ad load, or, the number of ads Facebook
can serve up to its users, the report said.
Facebook also has other avenues of ad load growth, including
Instagram, Messenger and WhatsApp, which have yet to fill up on
ads, it said.
Wall Street expects daily average users, which are 1.1 billion
now, to reach 1.7 billion in four years. By then, Facebook will
have learned more about how to turn its ads into transactions,
leading to growth in the advertising rate it charges, Barron's
said.
One concern, however, is Facebook's appeal to the young, as
those under 25 years are spending a lower amount of total mobile
time on Facebook compared to other age groups.
Still, Barron's said that the company could hit $153 a share in
a year, which would be a premium price, but not an outlandish
one given that investors are paying dearly for rare things like
growth, yield and predictability, the report said.
(Reporting by Catherine Ngai; Editing by Sandra Maler)
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