NEW YORK (TheStreet) -- Shares of Facebook (FB) dipped 0.52% to $77.49 in morning trading Tuesday after MKM Partners issued a research note and said Twitter's (TWTR) advertisements are outperforming Facebook's.
MKM notes several major ad agencies have reported better ad performances on Twitter compared to Facebook. Omnicom Group (OMC) has reported up to eight times better click-through rates for Twitter, while WPP and Publicis/Starcom (PUBGY) have also noted great success on Twitter and each have signed nine-figure spending agreements with the social media company.
But MKM remains bullish on Facebook's growth in revenue per user (RPU). The firm said Facebook's RPU ramped up to 45% to an annualized run-rate of $8.45 in the first six months of 2014, while the U.S. is up 58% to a run-rate of $26 per user. This is up from 29% RPU growth in 2013. MKM said the consensus for Facebook implies an RPU expansion to $14 by 2016 with the U.S. at $39.
Twitter's RPU run-rate was $4.60 after the second quarter, with the U.S. at $14. Twitter has narrowed the RPU gap with Facebook, as its RPU is now slightly more than half of Facebook's, compared to 40% one year ago.
Separately, TheStreet Ratings team rates FACEBOOK INC as a "hold" with a ratings score of C+. TheStreet Ratings Team has this to say about their recommendation: