Facebook Inc (NASDAQ:FB) shares soared to new highs this week, closing in on $50 per share. It also sparked upgrades from analysts at several firms, including Citi, which upgraded the stock to Buy, and Canaccord Genuity, which increased its price target to $60 per share.


Facebook’s status is new

But things weren’t always this way for the social network. Its botched initial public offering was just the first segment of a long-running downward spiral until the company surprised on earnings earlier this year. Suddenly investors are starting to see Facebook Inc (NASDAQ:FB) differently because it has begun to prove that it’s shift to mobile advertising will work.

They’re also starting to be more optimistic about the company’s new advertising products, like the video ads, which are expected to launch over the next few months.

But will Facebook’s status last?

There’s no denying that Facebook Inc (NASDAQ:FB) has been on a roll recently, but not everyone is convinced that the momentum will last. Paul R. La Monica wrote an editorial in CNN Money explaining how he was wrong about the company. He notes that his biggest mistake concerning Facebook was underestimating the company’s mobile efforts.

Nonetheless, he still questions whether the social network can continue the momentum it has experienced lately. He asked TechStrat Report author Sean Udall, one of Facebook’s investors, whether the company will keep the momentum going. Udall said he’s becoming a little less comfortable with Facebook Inc (NASDAQ:FB) now that it’s heading toward $50 a share. However, he said it could go even higher—perhaps as high as $60 a share.

Facebook and the other players

Udall believes that some of the online advertising spending is shifting from Google Inc (NASDAQ:GOOG) to Facebook, at least for now. He notes that Facebook itself has plenty of space to grow in mobile advertising.

However, Twitter is planning its own initial public offering, and he questions whether Twitter will steal some of Facebook Inc (NASDAQ:FB)’s thunder. He said Twitter might do better than Facebook and other social media stocks, so the momentum could shift from Facebook to Twitter. Of course it does depend on how well Twitter does in the earnings department.

Also expectations for Facebook are now running high in terms of earnings. He doesn’t think a penny or two above expectations will be enough to keep Facebook shares around $50. He says if the company doesn’t deliver in a big way, its stock could start tumbling.