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Suntrust Highlights The Top 10 Reasons Behind New Instagram 'Stories'

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Suntrust Highlights The Top 10 Reasons Behind New Instagram 'Stories'

Facebook Inc (NASDAQ: FB) has launched Instagram Stories, which is the company’s entrance into ephemeral content.

Robert "Bob" S. Peck of SunTrust Robinson Humphrey maintained a Buy rating on the company, with a price target of $142.

Similar To Snapchat

“The experience is very similar to Snapchat, where users string together pictures and videos into one “story” that disappears in 24 hrs,” Peck mentioned.

However, the analyst also pointed out that Snapchat has recently expanded into permanent content with “Memories,” stating, “It is quite obvious these two platforms remain on a collision course, which will be important for Facebook investors to monitor.”

Peck noted that this was Facebook’s third attempt to enter the ephemeral space and that the Internet is “littered with” several large platforms that have tried to copy smaller platform functionality but failed.

The key for Instagram would be to leverage its scale to take share from Snapchat.

Related Link: Booming Internet Celebrity Biz In China Gets Citi Bullish on SINA And Weibo

Reasons To Launch Stories

Peck believes that there are 10 reasons for Instagram launching Stories:

    1. To grow beyond Facebook and its own “perfect moments” posts.
    2. To leverage its verified accounts and discoverability.
    3. To enable users to create a “current identity” rather than an “accumulation identity.”
    4. To make it fun to post photos again.
    5. To remove the social pressure associated with hearts or likes.
    6. To increase original content creation.
    7. To reaccelerate the moderating U.S. user growth on Instagram.
    8. To increase engagement and the time spent on Instagram.
    9. To expand experience without impacting UI.
    10. To build functionality and become a “social augmented reality platform” (SARP).

“We anticipate the pace of innovation will only increase for both (Snapchat and Instagram) as they move to capture users and attention (time). We think investors must remain cognizant of these trends,” Peck added.

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Latest Ratings for FB

DateFirmActionFromTo
Dec 2019UpgradesHoldBuy
Dec 2019Initiates Coverage OnReduce
Dec 2019Initiates Coverage OnOverweight

View More Analyst Ratings for FB
View the Latest Analyst Ratings

Posted-In: Robert S. Peck SunTrust Robinson HumphreyAnalyst Color Long Ideas Reiteration Top Stories Analyst Ratings Trading Ideas Best of Benzinga

 

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