- Unbeliebable: White House turns Bieber petition response into immigration screed
- Obama signs law denying Iran ambassador’s visa, but says law is ‘advisory’
- Mich. judge to laughing convicted killer: ‘I hope you die in prison’
- Man charged in Kansas City-area highway shootings
- Keystone XL pipeline still on hold after State Dept. decision
- Fla. man charged with killing 16-month-old son to play Xbox undisturbed
- Drones from the deep: Pentagon develops ocean-floor attack robots
- Michigan mayor slaps back atheists’ try to erect ‘reason station’ at city hall
- PHILLIPS: Where is the conservative establishment?
- 7.5-magnitude earthquake shakes southern Mexico
Ahead of the Bell: Facebook surges on 3Q results
NEW YORK (AP) - Shares of Facebook surged in premarket trading Wednesday, as analysts praised the social media company's third-quarter results, including its first quarter of advertising to mobile device users.
Facebook's net income and revenue surpassed Wall Street expectations, and the company said about 14 percent of its advertising revenue came from ads for mobile users. It started showing those ads about six months ago.
In premarketing trading, Facebook Inc. shares shot up $5.19, or 26.6 percent, to $24.69. The stock hasn't traded that high during the regular session since July.
Citi Investment Research analyst Mark Mahoney said Facebook addressed two major concerns during the quarter: it was able to get money from mobile ads, and it reduced its revenue dependence on slumping Zynga Inc., the maker of "FarmVille," "Mafia Wars" and other games. Mahoney said Facebook got just 7 percent of its revenue from Zynga during the third quarter. That's down from as much as 12 percent in recent quarters.
Mahoney said Facebook shares have fallen to a reasonable price and the company's revenue growth is speeding up. He upgraded the stock to "Buy" from "Neutral," but trimmed his price target to $30 per share from $35.
"What investors have for the first time since the Facebook IPO is fundamentals acceleration WITH a reasonable valuation," he wrote.
Shares of Facebook closed at $19.50 Tuesday. The stock has lost half its value since its IPO priced at $38.
Jefferies analyst Brian Pitz said Facebook's ad revenue could improve as newer products like Offers and FBX ramp up over time. Pitz kept a "Buy" rating on the shares and raised his price target to $32 from $30.
TWT Video Picks
Women losing coverage under Obamacare, too
- Scalia to students on high taxes: At a certain point, 'perhaps you should revolt'
- Former Ranger breaks silence on Pat Tillman death: I may have killed him
- Feds approve powdered alcohol; 'Palcohol' available later this year
- Special Forces' suicide rates hit record levels casualties of 'hard combat'
- Justice at last: 'Evil woman' outed for grabbing girl's game ball
- Army goes to war with National Guard, seizes Apache attack helicopters
- Inside China: Marine's comment on islands draws sharp Chinese response
- EDITORIAL: More Lerner smoking-gun emails at IRS
- U.S. Navy to turn seawater into jet fuel
- EDITORIAL: Mark Warner running scared?
Top 10 handguns in the U.S.