SAN FRANCISCO, CALIF. (TheStreet) -- Facebook (FB) is a superpower on mobile and Instagram, now with 300 million month active users, will ensure the company stays in a position of supreme dominance for years to come -- at least that's the takeaway from JPMorgan's (JPM) latest research note on the social network.
"We believe Facebook's virtual ownership of the social graph, strong competitive moat, and focus on the user experience position the company to significantly improve monetization over time and to become an enduring, blue-chip company built for the long term.," JPMorgan analyst Doug Anmuth wrote in a note on Tuesday, maintaining his "outperform" rating on the social network with an $85 price target. "We note that Facebook's U.S. minutes are more than ~8.5x the minutes spent on the competitive services."
The bullish outlook is tied to digital analytics firm comScore's (SCOR) November Internet data dump, which tallied up total Internet time spent on desktop and mobile in the U.S.
Faceboook far and away stole the show, eating up 21% of all time spent on mobile in November, even when excluding usage of its other hit apps: Instagram and WhatsApp. The company improved its mobile share from 20% in the previous month, demonstrating signs of long-term health in the eyes of J.P Morgan analysts.
In total, when including desktop, people in the U.S. spent 166 billion minutes on Facebook in November, accounting for 16.9% of overall Internet time in the month. Meanwhile, Instagram, Twitter (TWTR) , WhatsApp, and Snapchat collectively racked up 20 billion minutes for around 2% of total Internet time spent in the month. Total minutes, by comScore's calculations, is the aggregate time spent on desktop, and iPhone and Android platforms, excluding tablets.
Despite the encouraging data, Facebook shares were trading marginally down Tuesday at $76.91 in the early afternoon.
Of course, the firm's report didn't overlook the potential of Facebook asset Instagram and its position in the market, even though time spent on Instagram in the U.S. fell 24% from the previous month, according to comScore's numbers. "We think Instagram could become one of the largest social networks over time, with significant monetization potential," Anmuth said.
JPMorgan, however, is heeding guidance from Facebook chief Mark Zuckerberg, who noted during the company's latest earnings call that the photo-centric Instagram won't be scaling its ad business anytime soon. The investment bank expects Instagram to slowly ramp up on ad sales, and is modeling $168 million in revenue in 2015 and $359 million in 2016.
That's a-okay, as JPMorgan believes Facebook proper still has room to grow. The social network's ad platform is still in transition to the higher quality News Feed ads, and "will become increasingly valuable to advertisers," Anmuth said.
--Written by Jennifer Van Grove in San Francisco, Calif.
>Contact by Email.