Better late than never? BTIG's Richard Greenfield, who upgraded Facebook (FB +0.2%) to Neutral in July following its blowout Q2 numbers, has upgraded shares to Buy in advance of this afternoon's Q3 report.
Greenfield, who has frequently criticized the quality of Facebook ads: "We notably underestimated Facebook’s stickiness as a consumer utility for messaging and photosharing, not to mention the power of Facebook as a "cure for boredom," both in-home and on-the-go. BTIG's survey data found even users who say they're dissatisfied with Facebook "continue to use it on a daily basis."
He's also optimistic about the potential of Instagram to offer high-quality brand ads backed by strong user feedback. Om Malik recently made a similar argument: he sees native ad formats such as Instagram's yielding much better engagement than standard display ads (for which click rates have been steadily dropping), and potentially "[openng] up a whole new era of Madison Avenue creativity."
Twitter (TWTR) doesn't want to get left out: the company just began allowing previews of images and Vine videos to directly appear in timeline feeds. That, in turn, could open the door to visual brand ads.
Facebook's sponsored news feed posts and Twitter's Promoted Tweet, Trend, and Account products also qualify as native ad products.