Facebook’s (NASDAQ:FB) advertising revenue rose from around $70 billion in 2019 to about $84 billion in 2020. Trefis expects the metric to rise further to about $114 billion in 2021 and $127 billion in 2022.
Advertising revenues are primarily generated by displaying ads on Facebook, Instagram, Messenger, and third-party affiliated websites or mobile applications.
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We expect ad sales growth to be driven by new products introductions, a higher number of users, and stronger engagement.
We don’t think the projected growth is priced into FB stock. We value the stock at a little over $400 per share, a 10% premium over the current market price.
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