Facebook (FB) - Get Facebook, Inc. Class A Report shares rose sharply Friday after Credit Suisse analyst Stephen Ju raised his price target to $480 from $400 ahead of the social-network company's second-quarter earnings next Wednesday.
He kept his rating at outperform.
“As Facebook (and the broader online ad industry) continues to benefit from budget recovery for the second quarter, our focus shifts back to offense and product development,” Ju wrote in a commentary.
“We believe the investment thesis boils back down to the conversion of its merchants/business profiles into paying advertisers.”
Further, “At the time of its last disclosure (the third quarter of 2020), the core Facebook app had 200 million business profiles and 10 million advertisers, while Instagram had 4 million advertisers,” Ju said.
“From a near-term tactical perspective, our conversations with advertisers continue to suggest ad budget recovery across most sectors.”
Analysts at Credit Suisse also boosted their price target on Alphabet (GOOGL) - Get Alphabet Inc. Class A Report, the parent of Google, ahead of next week's second-quarter earnings on the strength of innovation-led gains in it crucial advertising business.
Facebook recently traded at $373.54, up 6%, and has jumped 36% over the last six months amid strong financial performance. The S&P 500 has gained 15% during that period.
Meanwhile, social-network giant Twitter TWTR saw its shares rise, after better-than-expected earnings for the second quarter and a promise from CEO Jack Dorsey of a "big future" with Bitcoin. Shares of Instant messaging service Snap (SNAP) - Get Snap, Inc. Class A Report soared as second-quarter user growth took off.