3 Reasons Morgan Stanley Sees ~30% Upside in Facebook (FB), PT to $345

Morgan Stanley analyst Brian Nowak raised the price target on Facebook (NASDAQ: FB) to $345.00 (from $340.00) after the company reported a ~3% 4Q revenue beat (~1% better than expected ad revenue), leading to a ~3% adj EBITDA beat on leverage in G&A and S&M, which in turn, led to an ~8% GAAP EPS beat. The lower tax rate added ~$0.09 to EPS.

The analyst reiterated an Overweight rating, citing 3 reasons for the likely upside:

1) The macro recovery, ecommerce, and leading reach should drive ROI upward with multiple call options ahead for the company

2) IDFA is coming in 1Q, but it seems manageable as FB expects revenue to modestly accelerate

3) Other revenue is likely to offer breakout categories that could begin to reach noticeable size such as virtual reality (Oculus Quest 2)

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