Tags: Facebook | shares | Money | Maker

Oppenheimer Analyst: Facebook Is a Long-Term Money Maker

Thursday, 28 Jun 2012 07:25 AM

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Investors should buy Facebook shares for the long term as the company is a money maker, says Jason Helfstein, a senior Internet analyst at Oppenheimer.

The company is trading around $32 a share, well below the $38 figure priced at a May initial public offering.

Concerns have arisen that despite having 900 million users, Facebook will find monetizing that base difficult.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

Mobile advertising, however, will pump more money into company coffers down the road, Helfstein says.

"We do have some additional industry information — there was some data out from comScore that suggested that time spent on mobile devices using Facebook was up 10 percent month to month in April," Helfstein tells CNBC.

"If you annualize that, that’d give 90 percent growth year over year," adds Helfstein, who has assigned a $41 price target and an overweight rating on the stock.

“We think the stock will be an attractive opportunity for those long-term oriented investors.”

Expect Facebook’s worldwide penetration to rise to 59 percent by 2018 from 35 percent now, Helfstein adds.

"So, are we saying, 'Buy the stock and make money tomorrow'? No, but we think you buy the stock, you hold it for the next year or so, and we think this will be a money-making opportunity."

Morgan Stanley, chief underwriter for the company's initial public offering, believes mobile advertising revenue will flow even if later than thought.

"The mobile ad market remains in its infancy — while we believe Facebook will lead the market in mobile ad targeting, agency and brand transitions to mobile may take longer than expected," Morgan Stanley analyst Scott Devitt writes in a note, according to the Associated Press.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.






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