The social-media giant also hinted that its efforts to launch a cryptocurrency and digital wallet could come to fruition as soon as next year.
In a research note to clients, Guggenheim analyst Michael Morris raised his price target to $365 from $340 and held his buy rating on the stock, citing “growing on-platform commerce activity and messaging opportunities,” which together point to potentially stronger-than-forecast fourth-quarter ad revenue.
Morris also pointed to enhanced shopping features and increased platform commerce, that he said will “further bolster the value provided” to small- and medium-sized businesses, with additional messaging and publisher partnerships also being “incremental monetization drivers.”
He added that headwinds related to regulation and investment spending are “largely understood by investors and proactively addressed.”
The price-target upgrade comes as Facebook eyes a 2021 debut of its own cryptocurrency, dubbed Diem, as well as a digital wallet called Novi that could drive millions of its users away from traditional cash.
David Marcus, the head of Facebook Financial, also known as F2, said he hopes both the cryptocurrency and digital wallet Novi will launch next year.
“I hope that we get to participate with … Novi and Diem and the big changes of 2021, pending regulatory approvals where we need to obtain them,” Marcus said at the Singapore FinTech Festival.
Originally called Libra, Facebook’s cryptocurrency ambitions have received scathing criticism from regulators and even central bankers, forcing the company to recalibrate the effort and also roll out a rebrand.
Designed to be managed by a non-profit consortium called the Libra Association, the plan was to launch a wallet called Calibra that would allow users to send Libra cryptocurrency coins to each other. A Libra coin was supposed to be backed by a basket of currencies.
However, concerns from regulators including the impact Libra could have on financial stability to issues over privacy and money laundering in April prompted the consortium to shift gears and only offer stable coins backed by just one nation’s currency.
Last week, the Libra Association changed its name to the Diem Association. Earlier this year, Facebook changed the name of its digital wallet Calibra to Novi.
Shares of Facebook were down 1.07% at $282.54 in trading on Tuesday.