Facebook Inc. shares closed at a record price on Thursday, indicating investor confidence in the company's ability to grow its advertising business.
Facebook rose 2.3 per cent to $82.75 (U.S.) at the close in New York, topping the prior high of $81.45 on Dec. 22. That gave the company a market value of $232.4-billion, according to data compiled by Bloomberg.
The record comes after world's biggest social-networking service reported quarterly revenue and profit in January that topped estimates. The company has built out a mobile-advertising business that now accounts for 69 per cent of sales, compared with almost nothing at the time of its 2012 initial public offering.
Chief executive officer Mark Zuckerberg has pushed into advertising beyond Facebook's main site, on other developers' mobile applications and across the Web. The company has also improved its tracking of individuals as they respond to ads, providing better information for marketers. Analysts predict, on average, that Facebook's revenue will rise 37 per cent this year to $17.1-billion.
The analysts' 12-month price target for Facebook, on average, is $91.57, according to data compiled by Bloomberg. The stock climbed 43 per cent last year, compared with an 11-per-cent gain in the Standard & Poor's 500 Index.
Facebook has been updating its products, working on a competitor to Twitter Inc.'s MoPub for mobile advertising, sources familiar with the matter have said. The product could be released as soon as next week, at the company's F8 developer conference. Facebook also expanded its Messenger application this week to include a way for people to send money to friends.
The company is demonstrating there's "the opportunity to do more on the platform than meets the eye," said Daniel Ernst, an analyst at Hudson Square Research. "If anyone can make that happen and scale it, that should be Facebook. News of the payments offering is direct evidence that Facebook might deliver."