Facebook Inc (NASDAQ:FB) is one of the most popular stocks on the market right now. The company has finally shown an ability to monetize its user base and become successful on mobile platforms. The firm’s $1 billion acquisition of Instagram is still in the minds of investors, however, and the firm needs to move quickly to establish the photo sharing service as a money-making concern.

Instagram facebook

A new report from William Blair takes a look at Instagram and estimates that Facebook Inc (NASDAQ:FB) might start monetizing the service as early as the fourth quarter. The analysts do not think it will bring in much revenue in that quarter, but they expect the effort to ramp up throughout 2014.

Alienating Instagram with ads

One of the problems with establishing an advertising base on a web site is user reaction. Facebook Inc (NASDAQ:FB) needs to put ads on Instagram in order to make the investment pay for itself. It can’t afford to have a negative user reaction, however, and that’s one of the most complex problems the company faces.

Facebook Inc (NASDAQ:FB) has shown itself well able to do just that on its social network, which is one of the most impressive things the company has done in the last year, and it’s one of the reasons that Facebook Inc (NASDAQ:FB) shares have risen to such highs in recent months. Facebook needs to repeat that trick on Instagram if it wants the market to react well.

Instagram is an important service for Facebook Inc (NASDA:FB), but it is not the only thing that the company needs to concentrate on through the rest of the year, and the next. Several other aspects of the company’s business are looking positive according to the William Blair analysis.

Facebook monetization

The report rates Facebook Inc (NASDAQ:FB) at Outperform based on the firm’s increasing mix of mobile revenue, and strong trends heading into the fourth quarter of the year. Mobile will account for 47-50% of the company’s revenue this quarter according to the report, and larger retailers are likely to begin allocating more money for Facebook ads through the new year.

On top of those trends, Facebook Inc (NASDAQ:FB) innovation in advertising, including the coming video ads, are strong drivers of growth at the company. William Blair thinks that Facebook shares could hit as high as $58 in the coming months if the trends continue.