Facebook's (FB) Price Target Raised to $150 at MKM Partners

(Updated - May 13, 2016 11:18 AM EDT)

MKM Partners maintained a Buy rating on Facebook (NASDAQ: FB) and raised its price target to $150.00 (from $135.00). Analyst Rob Sanderson called Facebook a must-own stock for growth managers, and he thinks it Facebook will benefit from shifting ad budgets.

"We continue to like FB as by far the dominant growth vehicle among mega-cap TMT stocks. Despite being a consensus long for multiple years now, the company continues to deliver impressive growth. FB is benefiting from (and driving) the shift in ad budget allocations from other media to mobile internet and we think this story is still early. While current waves of growth in core Facebook and Instagram are still robust, the next wave in messaging is beginning to take shape," said Sanderson.

"We monitor the allocation of dollars between digital and TV advertising properties by tracking the U.S. ad revenue of the top-15 platforms. Total ad dollars in our tracker have accelerated to 15% the past two quarters, from 9-10% a few quarters ago," added the analyst. "According to the tracker, FB’s share of allocation has increased to 10% by Q1’16, doubling over the past two years, while the total pie has also grown by 25% over this time. Consensus implies that the total spend will grow by about 15% this year and that FB share will expand another 200bps by year-end."

For an analyst ratings summary and ratings history on Facebook click here. For more ratings news on Facebook click here.

Shares of Facebook closed at $120.28 yesterday.

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