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Shares in Facebook (FB) Jump on News of Instagram Ads

By  +Follow October 4, 2013 5:31AM
Tickers Mentioned:

Shares in social media giant Facebook (FB) spiked Friday on news that it would start selling ads on the photo-sharing service Instagram. News that Facebook would begin monetizing their $1 billion acquisition from last year pushed shares up almost 3.5 percent.

Instagram to Ease Users In

Instagram assured users in a blog posting that it would make efforts to prevent the new ads from interrupting their users’ current experience.

“Our aim is to make any advertisements you see feel as natural to Instagram as the photos and videos many of you already enjoy from your favorite brands,” Instagram said on the blog. “After all, our team doesn’t just build Instagram, we use it each and every day. We want these ads to be enjoyable and creative in much the same way you see engaging, high-quality ads when you flip through your favorite magazine.”

”Seeing photos and videos from brands you don’t follow will be new, so we’ll start slow. We’ll focus on delivering a small number of beautiful, high-quality photos and videos from a handful of brands that are already great members of the Instagram community,” the blog post continued.

The $1 billion deal to purchase Instagram in April of last year appeared peculiar to many at the time, coming as Facebook was ramping up for its IPO and appearing to buy a steep premium on the small company’s value. However, the long-term strategy may appear clearer after today’s announcement.

Mobile Presence a Focus With Pending Twitter (TWTR) IPO

Many analysts believe the push to increase ad revenues through Instagram is a positive move for Facebook.

“There just continues to be momentum, continues to be good news,” said Benjamin Schachter, an analyst at Macquarie Securities USA Inc. “Even though the Instagram news was somewhat expected over time -- we’ve been waiting for the announcement this year, and yeah, it’s going to be a positive.”

The move comes one day after Twitter ($TWTR) opened its confidential IPO. News outlets have compared the two companies, with a particular focus on mobile ad revenues, noting that 65 percent of Twitter’s ad revenue was coming from mobile as compared to just 41 percent of Facebook’s. As more and more users shift to mobile, Facebook’s ability to monetize ads in that area is believed to be crucial, and Instagram could ultimately prove to be an essential piece of that puzzle.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.

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Results for FB
Skinny Asian Dude
25 Oct 14 05:00:01
RT @MatthewPhillips: Switcheroo. Zuck Vs. Bezos, in market capitalization. $FB $AMZN http://t.co/rSqXVpm2QN
25 Oct 14 04:51:18
@TheDomino hi Dom what is your call on $twtr earnings coming up? Everyone high on $fb no news on $twitter!
25 Oct 14 04:45:49
Top 4 Signs the Stock is a Scam http://t.co/ttcBMo9ZS4 #stocks #trading $FB $GPRO $LNKD http://t.co/E0j6YmQxEu
Financial Iceberg
25 Oct 14 04:35:29
Technical Observation of the Day: New High on Facebook - $FB http://t.co/nQraLgiiPl
Nero The Red
25 Oct 14 04:31:01
@JonathanHoenig stop them with $FB &TWTR policy... They should not want their site to be used for that purpose.
25 Oct 14 04:30:03
Top Stock Picks: $EW $TWTR $GILD $CELG $RGLS $PG $FB $BAC $DRIV $AAPL http://t.co/XQITF0lRKD #nasdaq #spy #stocks #analyst #swingtrading
PennyStock Zone
25 Oct 14 04:13:03
http://t.co/iBFjWBITEB <--- Amazing subscriber to Super_Trades - check out his profit chart!!! $VSR $NQ $YY $FB #stocks #trading
Financial Iceberg
25 Oct 14 04:05:05
Fibonacci Technical Levels $AMZN, $AAPL, $FB, $GOOG ​#amzn #aapl #fb #goog http://t.co/v8squeMI5L
Options TradingIQ
25 Oct 14 04:00:11
Covered Calls and Volatility http://t.co/brdAyCTkRt $AAPL $FB $TWTR $MSFT $SPY $XOM
25 Oct 14 03:53:43
FB 80.67 Stock Charts $FB Facebook Inc. Cl A (NASDAQ) Last Updated: 10/25/2014 05:53:42 FB Stock Chart - 1 Mon http://t.co/3H7QG3AeoS
Carolyn B Miciano
25 Oct 14 03:52:16
"Free course on \""Beta\"" of #stocks http://t.co/QS0uCeLh5Z $AMZN $FB $TWTR "
25 Oct 14 03:50:00
Actionable Options for Fri, Oct, 24 TWTR $FB http://t.co/VwAPuPyKiY
25 Oct 14 03:31:52
new entries monday... $EXR w/51.14 stop, $CRL w/56.22 stop, and $FB w/71.3 stop...
25 Oct 14 03:30:20
Can someone explain to me how $FB just keeps on rising...?
Interactive Options
25 Oct 14 03:16:03
$FB chart almost #earnings play time @lloyd__bradford https://t.co/cjfWNotqlJ via http://t.co/90WgVPFFRS
25 Oct 14 03:02:53
Twitter Q3 Might Show Payoff From New Products http://t.co/HC5LX0V8N4 #IBDNews via @IBDinvestors $TWTR $FB $GOOGL
25 Oct 14 03:01:44
Weekly S&P100 #Stocks Trend $ABBV $AMGN $GILD $GD $TXN $MMM $AAPL $UNP $MDT $BMY $FB $LLY $LOW $HON $FDX $QCOM @ http://t.co/n4QZIDxy7w
25 Oct 14 03:01:32
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Diego D'Aquilio
25 Oct 14 03:01:29
Stephen Hawking Joins #Facebook $FB, Likes 'The Theory of Everything' http://t.co/LSueUbeatV
Jazz Katz
25 Oct 14 02:59:48
So $FB Facebook is worth 15% more this week than last week at this time..mmm OK
PennyStock Zone
25 Oct 14 02:43:59
http://t.co/3h2MEfTvST <<-- Free Webinar Learn How To Survive This Crazy Market $CLRO $CLRB $AAMAF $AVGO $LAD $FB $GPRO
25 Oct 14 02:38:09
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25 Oct 14 02:34:38
RT @FluentInFinance: #Yahoo is now the 3rd largest mobile advertising company in the world https://t.co/FnowofxR20 $YHOO $GOOG $FB $MSFT ht…
25 Oct 14 02:24:02
http://t.co/v31H5i6SbE <<-- Free Webinar Learn How To Survive This Crazy Market $CLRO $CLRB $AAMAF $AVGO $LAD $FB $GPRO
25 Oct 14 02:09:58
Mark Zuckerberg added $712m y'day, most among world's 200 richest, as $FB debuted new app http://t.co/QCAoZSK7Eh http://t.co/J8nj0LuYUg
Bullimalinna Sot
25 Oct 14 01:36:58
got to make sure the bill pay first, then I can work on some personal projects. Few gigs left of October. Beat $AAPL, $BABA, $FB too :)
Marko Hristov
25 Oct 14 01:21:11
Twitter Q3 Might Show Payoff From New Products http://t.co/maN22IHkVK #IBDNews via @IBDinvestors $TWTR $FB $GOOGL
25 Oct 14 01:19:08
$FB might be an idea to take the $$$ now looking ripe for a reversal #elliottwave http://t.co/mHxnnWLshS
Pivot Point Trading
25 Oct 14 01:12:12
Виталю Тюлюкин
25 Oct 14 01:04:27
RT @SeekingAlpha: Cramer's Lightning Round - Facebook Is Worrisome (10/23/14) http://t.co/cN8yc0Go5w $COV $UAN $EW $FB $BGS
25 Oct 14 00:56:57
Can you invest in Cannabis? http://t.co/fS7xp7UYP8 #stocks #trading #greenrush $FB $TWTR $LNKD http://t.co/frLFOFainl
Russell Barbour
25 Oct 14 00:42:49
25 Oct 14 00:31:45
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25 Oct 14 00:14:44
RT @daily_finance: Facebook CEO Mark Zuckerberg buys Hawaiian beach and plantation for $100 million http://t.co/qTeKjVITHI $FB via @aolreal…
25 Oct 14 00:13:36
@jimcramer your price target for $FB was $90. I'm glad you no longer believe so much in the company. Yeah sell at $80.
25 Oct 14 00:11:57
RT @IBDinvestors: Did the Twitter 'buy' button make $TWTR a buy? Earnings due Monday http://t.co/i9NgNX0Vag $FB $GOOGL
PennyStock Zone
25 Oct 14 00:03:40
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Ohio Spot Light
25 Oct 14 00:01:00
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24 Oct 14 23:52:32
RT @IBDinvestors: Did the Twitter 'buy' button make $TWTR a buy? Earnings due Monday http://t.co/i9NgNX0Vag $FB $GOOGL
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Port Washington FD
24 Oct 14 23:36:45
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24 Oct 14 23:32:43
ass#ssisi siiii $fb di g 3# táctil?
24 Oct 14 23:29:54
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Profile Designs
24 Oct 14 23:12:29
#Facebook has reached out to #YouTube's biggest stars to urge them to distribute their videos on Facebook. http://t.co/2vawXPKgpd $FB $GO
PennyStock Zone
24 Oct 14 23:09:18
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24 Oct 14 22:45:36
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24 Oct 14 22:31:45
24 Oct 14 22:15:16
http://t.co/5qzSIjoPtA <--- Amazing subscriber to Super_Trades - check out his profit chart!!! $VSR $NQ $YY $FB #stocks #trading
24 Oct 14 22:12:43
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Dan Nathan
24 Oct 14 22:08:57
ICYMI: Name That Trade - $FB: Liking Protection http://t.co/RnTADoapIU
By  +Follow October 4, 2013 5:31AM



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