Shares of Facebook Inc. (NASDAQ: FB) and Groupon Inc. (NASDAQ: GRPN) rallied in trading on Monday, driving the technology sector higher.
Facebook shares rose 4.65% to finish the day at $31.41 on volume of 42.98 million. The stock touched an intra-day high of $32.08. FB shares have now gained 15.47% in the last three trading sessions, and are inching close to their IPO price of $38.
Facebook shares rallied on Monday after the social networking giant announced the acquisition of facial-recognition technology company Face.com. FB did not disclose the financial terms of the deal.
Tel Aviv, Israel-based Face.com is the developer of a technology used for facial recognition on photos loaded onto websites and through mobile applications. Face.com’s apps, Photo Finder and Photo Tagger, are already used on Facebook.
Facebook said that Face.com’s technology has helped to prove the best photo experience for people sharing photos over the social network and that the transaction simply brings a world-class team and a long-time technology vendor in house.
In a research note, Michael Pachter of Wedbush Securities said that the acquisition would likely boost the number of mobile tags on Facebook, improving user engagement on the social network.
Groupon shares were the other big gainers in the tech sector on Monday. Shares of the daily deals site rose 10.83% to finish the day at $11.15 on above average volume of 13.65 million. GRPN shares have gained 16.15% in the last three trading sessions.
GRPN shares surged on Monday after Morgan Stanley analyst Scott Devitt raised his rating on the stock to Overweight from Equal Weight. Devitt has a price target of $18 on GRPN shares. In a research note, he said that through 2012, the company has made a number of moves to enhance its business scale and technological operations.
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