Morgan Stanley Ups Facebook Targets, Says Ad Biz Still In 'Early Days'

In a report published Thursday, analysts at Morgan Stanley maintained their Overweight rating on

. The price target is set to $94. According to Morgan Stanley, "FB's still-accelerating ex-FX ad growth and near-record daily engagement growth speak to how it is still early days in the company's efforts to grow its industry-leading global ad business." The analysts believe the company faces a "unique opportunity to continue to grow its share of ad budgets by leveraging its unmatched global desktop and mobile reach and engagement, unique user dataset and continuously-improving ad products and offerings." Facebook reported constant currency ad growth higher than the estimates at 55 percent. The company's two-year ex-currency stacked ad growth grew for the ninth consecutive quarter to 137 percent. Engagement trends were also strong, with the company adding 46 million daily active users. In fact, Facebook has been able to consistently add more than 40 million net daily active users every Q1 for the past five years. Instagram also reported the addition of more than 300 million monthly active users. On the other hand, non-GAAP expenses grew 57 percent, which was about 170 bp higher than the estimates, driven by acceleration in opex per employee to growth of 6 percent. "FB spent more that we modeled, but we remind investors that FX has a double impact on FB's EBITDA as the vast majority of its opex is USD denominated," the analysts explained. Facebook has revised the top-end of its non-GAAP opex growth guidance range for FY15 down to 50-60 percent, from 50-65 percent.