Facebook Inc (FB) Has A Winning Ad Campaign: Cantor Fitzgerald

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Facebook Inc (FB) Has A Winning Ad Campaign: Cantor Fitzgerald
Facebook Inc (NASDAQ:FB) is finally winning the battle in mobile ad campaigns, according to the latest analyst report by Cantor Fitzgerald. The social networking company has gradually improved its mobile platform engagement statistics, while the desktop platform continues on a downward trend. Facebook Inc (NASDAQ:FB) still ranks above Google Inc (NASDAQ:GOOG), Yahoo! Inc. (NASDAQ:YHOO), and AOL Inc. (NYSE:AOL) in terms of engagement to the user.

In a report published Monday, Cantor Fitzgerald analysts Youssef Squali, Naved Khan, and Kip Paulson, CFA reiterated Facebook Inc (NASDAQ:FB) at Buy, with a price target of $28, citing growth in the company’s mobile platform campaign. On the same day, Piper Jaffray analysts maintained their outperform rating on the stock, despite lowering the price target, and also cited improvement in mobile platform as one of the driving factors to their reiteration.

Facebook Inc (FB) Has A Winning Ad Campaign: Cantor Fitzgerald

The desktop platform has experienced a continuous decline over the last three months since July, while the mobile platform engagement has been growing gradually, since March. In October, the two platforms were tied following a decline of about 3.1% on the desktop side month-over-month. The total time spent on the PC based platform stood at 52.8 billion minutes in the U.S.; Nonetheless, the analysts noted that the overall engagement improved by about 1.4% sequentially. “We believe time spent on mobile devices should comfortably exceed PC usage by year-end,” the analysts wrote.

Facebook Inc (NASDAQ:FB) continues to lead the engagement charts. The social media giant ranks at the top followed by Google Inc (NASDAQ:GOOG), and Yahoo! Inc. (NASDAQ:YHOO), respectively, while AOL Inc. (NYSE:AOL) is placed bottom. The analysts did not mention where the likes of Twitter and Microsoft Corporation (NASDAQ:MSFT)’s Bing are positioned.

The analysts wrote, “Facebook is leading the field for total minutes spent on the platform, according to October U.S. mobile engagement data from ComScore Mobile Metrix”. According to statistics Facebook time spent metrics increased by 6.4% month-over-month, to 52.1 billion minutes in October-12. On the contrary, AOL sites fell 11% while Google and Yahoo! sites remained flat. The data also included tablet usage, which is currently likely the fastest growing component, noted the analysts.

Monetization Campaign Gathering Momentum

Facebook has started reaping the benefits of its ad monetization campaigns. The analysts pointed that the company is now collecting approximately $3 million per day worth of revenues from its sponsored stories ad campaign. This equates to about $1 billion annual revenue.

The social, networking company launched several other monetization campaign over the last two months (September and October), which could spur its revenues further. These new, compelling opportunities include Offers (introduced in September), Facebook AdExchange (or FBX, rolled out in September), Gifts (announced in late September), Promoted Posts, and Mobile App-install ads (both launched in October).

The analysts wrote, “these new ad formats and offerings represent compelling opportunities, especially considering that newer ad formats in the news feed can have 8+ times the engagement of the right hand side ads and 10+ times ad recall”. The added that Facebook Inc (NASDAQ:FB) is an attractive stock as the company is still early in the optimization/targeting/monetization phase.

At the time of this writing, Facebook Inc (NASDAQ:FB) stock was trading at $22.89 per share, down $0.03, or a 0.13% decline from yesterday’s close.

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