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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
23 Sep 14 06:46:05
Shorted more $FB 76.80
23 Sep 14 06:42:57
Long $scss $gild $bac $fmcc $fb $cmg $tsla
23 Sep 14 06:40:04
Facebook prepares 'Google-beating' advertising platform http://t.co/AxHwP4Pna2 $FB $MSFT $GOOG
23 Sep 14 06:37:28
Shorted $FB 76.20
Guru Algo Trading
23 Sep 14 06:33:35
James Stollenwerck
23 Sep 14 06:33:15
Trade: 0 $FB S: 0 0. http://t.co/7WTJdILDhJ
23 Sep 14 06:32:00
$FB http://t.co/i45wp9Ey5B I don't understand why people don't take the time to learn to read charts... $FB is going down...
Nonko Trading
23 Sep 14 06:30:15
$FB to announce new advertisement platform
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23 Sep 14 06:29:59
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23 Sep 14 06:27:59
$FB... Looking for at least 69.70, then 67.55 $FB http://t.co/PjJPzOHyod
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$FB chart: $FB... Looking for at least 69.70, then 67.55. http://t.co/pPlhavGSvV
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Fibonacci Technical Levels $AMZN, $AAPL, $FB, $GOOG ​#amzn #aapl #fb #goog http://t.co/QxvbGDLcf0
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bill tillery
23 Sep 14 06:19:58
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Sandra Woo
23 Sep 14 06:18:02
RT @YahooFinance: Early Movers: $AAPL, $AZN, $SHPG, $FB, $MSFT, $DB & more http://t.co/tkiQjLt6Fa
Becky Hiu
23 Sep 14 06:17:47
Commented on StockTwits: Haha but indices rebalancing do, i.e. $TWTR $FB last Friday http://t.co/YxN9fW5dFL
Filip Maciolowski
23 Sep 14 06:17:15
Here Are Your Early Market Movers, Why They Are Moving, And More http://t.co/KaXoqt8eKt via @DITRLI $AAPL $AZN $DB $FB $MSFT $SHPG #Stocks
23 Sep 14 06:16:59
Early movers: $AAPL, $AZN, $SHPG, $FB, $MSFT, $DB http://t.co/KFlJxVd1Pj
Stock Market Picks
23 Sep 14 06:14:43
Facebook revamps ads in new challenge to Google http://t.co/1fmcJ7S9yP $FB $GOOG $QQQ
Ryan Mallory
23 Sep 14 06:13:56
$FB Long Setup http://t.co/wjUJZGXk0n
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23 Sep 14 06:11:14
Trade using support and resistance http://t.co/fySig5FaDS $AMZN $FB $TWTR
Colin Macleod
23 Sep 14 06:07:19
T3 Live Under the Hood (Morning Call Express) http://t.co/WoHRQ4TAuM $SPX $IWM $TSLA $NFLX $AAPL $GOOGL $LNKD $YELP $BABA $TWTR $FB
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23 Sep 14 06:05:50
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Almost a Trader
23 Sep 14 06:02:41
Watching: $YHOO ($BABA) $HLF $KMX $TKMR $DKS - $SOCL stocks - $P $FB $TWTR $GPRO #stocksinplay #scanning - Keep it tight!
23 Sep 14 06:01:43
RT @YahooFinance: Early Movers: $AAPL, $AZN, $SHPG, $FB, $MSFT, $DB & more http://t.co/tkiQjLt6Fa
23 Sep 14 05:59:09
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Colin Macleod
23 Sep 14 05:57:32
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Sandra Matthews
23 Sep 14 05:56:51
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23 Sep 14 05:56:30
RT @2morrowknight: Twitter users share less content than they do when they’re on Facebook http://t.co/oGj7HqWhT3 #SMWMumbai $FB $TWTR http:…
23 Sep 14 05:54:32
$FB 2.99 a month starting in NOV??? NEXT... May go w/ GOOGLE's social network lol http://t.co/j0D2cvMb9i
23 Sep 14 05:53:48
$FB http://t.co/7UXPtRBZnY I will pass VERY QUICKLY... FB is not that deep. lol
tom brakke
23 Sep 14 05:52:06
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Jayson Smith
23 Sep 14 05:50:27
RT @mbmccarty: How to use "Hey Siri" without connecting your iPhone to a power source: http://t.co/pP5tlfVZqH $fb
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23 Sep 14 05:48:16
Thudder & Wicks
23 Sep 14 05:48:03
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Ken Stutt
23 Sep 14 05:46:51
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23 Sep 14 05:46:43
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23 Sep 14 05:44:29
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23 Sep 14 05:43:37
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Stefan Cheplick
23 Sep 14 05:43:02
Facebook to me: "organic growth is dead." $FB
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How Facebook Can Predict Your Politics, Your Love Life, And Even Your Sibling's Name. $FB. http://t.co/EZoUAzKvZA
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23 Sep 14 05:34:17
Major European and Asian indices significantly down $TSLA $LNKD $PCLN $BIDU $GOOG $FB $TWTR $AMZN $AAPL $NFLX $QQQ http://t.co/6SPwzYM8H2
Jesus Cryptos
23 Sep 14 05:34:04
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23 Sep 14 05:33:49
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Giorno Givoanna
23 Sep 14 05:33:44
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Alwin Samayoa
23 Sep 14 05:31:25
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Christopher Angus
23 Sep 14 05:30:03
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Chris Judd
23 Sep 14 05:29:59
RT @mbmccarty: How to use "Hey Siri" without connecting your iPhone to a power source: http://t.co/pP5tlfVZqH $fb
By  +Follow October 4, 2013 5:31AM



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