By Benjamin Pimentel, MarketWatch
SAN FRANCISCO (MarketWatch) — Facebook Inc. shares were among the tech sector’s notable gainers on Thursday, rising sharply to put the stock on track for its first weekly gain since the company went public May 18.
Facebook FB +3.74% rose nearly 4% to $28.29.
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For the week, the stock was up 4.4%, after posting three consecutive weekly losses since the social network’s controversial initial public offering last month.
Facebook’s stock still ended down 10% from its IPO price of $38.
The company got a lift from its announcement of a new advertising-bidding system, which one analyst called a positive sign that Facebook was exploring expanding its revenue base.
Dubbed Facebook Exchange, the new system allows advertisers to “bid in real time on a specific ad impression,” according to the company.
“For example, a travel site may be interested in reaching a person who searched for a flight but did not complete the purchase,” the representative wrote in emailed comments. “With Facebook Exchange, this travel website can show that person a related ad on Facebook.”
The email stressed that Facebook, which has faced criticism over its privacy practices, does “not share any user data with advertisers and people still have the same control over the ads they see on Facebook that they do today.”
Facebook has been the subject of speculation on whether businesses actually benefit from ads posted on the social network. That has raised worries about the Menlo Park, Calif.-based company’s ability to grow revenue.
Wedbush analyst Michael Pachter said Facebook Exchange at least shows “that they are trying.”
“The important thing is that they are mixing it up, trying to find ways to better monetize, and I think that is important,” he wrote in an email.
“I don’t think any of us can know whether allowing access to browser history really makes advertising more effective, but Google GOOG -0.36% does it and people just love them,” he added. “It makes sense that this will work for Facebook, and I think that the market is finally seeing signs that Facebook management cares about growing revenue.”
Benjamin Pimentel is a MarketWatch reporter based in San Francisco