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How Facebook could rally more than 30%

Instagram is among several platforms offering clickable ads to purchase opportunities.
Source: Instagram
Instagram is among several platforms offering clickable ads to purchase opportunities.

A Wall Street analyst makes a compelling case that Facebook shares could rise more than 30 percent over the next 12 months as it starts to monetize its non-core properties WhatsApp, Instagram and Messenger.

Sarah Hindlian of Brean Capital believes her peers are significantly undervaluing the contributions to revenue these three services will make to Facebook's revenue next year. If that becomes clear to more analysts, the shares could take off.

Facebook closed Tuesday at $81.06 a share. Hindlian's $108 price target is the second highest on Wall Street, behind a $114 projection from a Hilliard Lyons analyst.

Here's how Brean sees the social networking giant getting there...