Facebook's growth from its new video product will boost the company's shares, according to one Wall Street firm.

Jefferies reaffirmed its buy rating for the social media giant, predicting the "Watch" offering will drive significant sales and increased site use.

"We think Facebook's 'Watch' tab extends its reach into user's video consumption. The 'Watch' tab should drive video engagement and will also provide additional network effects and sharing," analyst Brent Thill wrote in a note to clients Wednesday. "We like FB's data-driven approach to content creation and partner rev. share agreements as it manages content investment."

Thill reiterated his $225 price target for Facebook shares. That's 25 percent higher than Tuesday's closing price.

Facebook's "Watch" video tab launched in August. Thill predicts "Watch" could grow to $12 billion in revenue by 2022.

"We believe this will be 'snackable' content versus more premium long-form content which should help drive time spent, more repeat visits," he wrote.

We "see Facebook as one of the best positioned digital players to capitalize on an ad-funded model given Facebook's industry leading advertising technology, user data, and targeting capabilities," he wrote.

Facebook shares have rallied 56 percent this year through Tuesday, compared with the market's 20 percent gain.