Facebook shares were upgraded to buy from neutral by Nomura Instinet on Monday, citing a faster-than-expected transition by consumers to the social media company's Stories format and its new focus on messaging.

The firm also raised its price target on Facebook to $215 from $172. The stock was up 2.5 percent Monday at $173.89.

"We based our downgrade of FB shares to Neutral last year on our view that the transition to Stories would take more time than bulls expected. However, as we heard at industry events earlier this year and in our own conversations, the transition appears to be occurring more quickly than we expected, lessening our concern," analyst Mark Kelley said in a note.

"Mark Zuckerberg's recent blog post also suggested that engagement could improve as the company looks to focus on encrypted and ephemeral messaging across properties, in addition to the current core functionality," Kelley added.

Facebook shares have roared back by 29 percent in 2019, yet are still down more than 8 percent for the last 12 months as investors question whether the company will face increased regulation that will hurt growth because of privacy concerns.

The Instinet analyst thinks increased regulation will be a "net positive for large platforms like" Facebook over the long term but it could continue to weigh on the stock in the short term.

— With reporting by CNBC's Michael Bloom