Facebook Could Still Hit $150: Here's Why

Pacific Crest says Facebook Inc FB shares could touch its $150 price target, driven by early strength in video, massive audience, Instagram and potential monetization of other ancillary opportunities.

“We see the potential for upside to this target ($150) from strong execution in video, successful monetization of messaging, or stronger-than-expected pricing growth on the core platform,” analyst Andy Hargreaves wrote in a note.

The analyst said higher pricing and emerging monetization of video would soothe investors’ biggest concern on Facebook that is nothing but slowing ad-loads.  

Hargreaves expects Facebook to see higher engagement levels from the recent rollout of a video button on the home page of the mobile app. If executed well, the analyst believes the move could attract ad dollars from brand advertisers.

Meanwhile, the analyst expects solid fourth quarter results, projecting non-GAAP EPS of $1.37 versus the consensus estimate of $1.30. The analyst estimates ad revenue to grow 50 percent to $8.47 billion, which would exceed the sell-side consensus estimate of $8.29 billion.

Over the medium term, Hargreaves believes Facebook's video efforts will allow it to encroach on the market share of traditional TV networks. This can be achieved with a video product with higher-quality content.

At last check, shares of Facebook rose 1.07 percent to $132.89.