Facebook shares plunge below IPO price
Source: AFP
Facebook shares plunged nearly 11 percent Monday during the stock's first full day of trade as the enthusiasm from a massive public offering for the social network giant turned to skepticism.
The stock closed at $34.03, down 10.99 percent for the day and well below the $38 initial public offering price, which made Facebook the second largest US IPO of all time.
The tumble followed a turbulent opening trading session on Friday, which saw an early surge in Facebook shares, then a fall back to the offering price of $38. With help from underwriters, the stock ended up slightly.
"Retail investors are scared. Most people thought this was a hot deal, and now that it's not, no one knows where the bottom is," said Lou Kerner of the Social Internet Fund.
Read more: http://news.yahoo.com/facebook-shares-plunge-below-ipo-price-135053772.html
bayareamike
(602 posts)bluerum
(6,109 posts)FB is worthless imo- but W.C. Fields has it right.
sofa king
(10,857 posts)I was going to say you must have been thinking of P.T. Barnum, but it looks like he didn't say it either.
But I know for sure what you meant, and I completely agree.
bluerum
(6,109 posts)Will have to track that one down.
ozone_man
(4,825 posts)It's morally wrong to allow a sucker to keep his money.
- W. C. Fields
sofa king
(10,857 posts)It explains why I'm poor.
TahitiNut
(71,611 posts)RKP5637
(67,112 posts)Javaman
(62,534 posts)wilt the stilt
(4,528 posts)about a week ago and a bunch of people said I didn't know what I was talking about and I was jealous. It's just a big nothing.
KurtNYC
(14,549 posts)or sell short. I made good money betting against Clinton's impeachment and resignation that way, and it shuts them up.
truthisfreedom
(23,168 posts)second day... Just wow!
NRaleighLiberal
(60,034 posts)beac
(9,992 posts)See outside Facebook headquarters:
TheDebbieDee
(11,119 posts)beac
(9,992 posts)Republican events.
RockyMtnGuy
(83 posts)Nothing, nada, zilch. Web-based products are intangible, therefore they have to prove value. What can Facebook offer that makes consumers' lives easier or more efficient? Facebook has no product, they offer nothing. They can't even prove their banner ads space drives revenue for advertisers. Google makes navigating through the Internet more effective, Facebook, eh I'm still not seeing it.
onehandle
(51,122 posts)They will both end up with myspace and pets.com.
provis99
(13,062 posts)But Facebook defenders are about as delusional about the value of that product just as much as Apple defenders are.
may3rd
(593 posts)and people LOVE sharing their most intimate secrets with big brother.
spiderpig
(10,419 posts)There are so many needy people out there that need to describe every mosquito bite.
I just used it to track down old friends and connect with them off Facebook.
Even so, I get an average of 80-100 spams per day.
harun
(11,348 posts)joeglow3
(6,228 posts)It is about providing an intangible product (television show, radio show or entertainment on the computer) to attract viewers and gain advertising dollars. Welcome to the 21st century.
Skittles
(153,298 posts)that's the only real surprise
Ruby the Liberal
(26,219 posts)Especially one as overhyped as FB.
DeSwiss
(27,137 posts)I mean this is Amurika we're in, right??? So the guy has a product and he gives it away for free! Now I ask you: ''How can't he make a profit with a business model like that?!?!?'' All he's asking for is the most intimate details of his product's... er I mean of his customer's life so he can share it with advertisers who'll in turn bombard them with spam and junk mail!!! Now is that too much to ask so he can become a billionaire?
- Who's a guy gotta screw around here to make a couple a billion bucks!?!?!?!
K&R
Blast From The Past: SNL Explains Wall Street
pa28
(6,145 posts)I wonder how they came up with the valuation they did.
When a company goes public everything changes and you can't just have really great earnings and be happy with that.
They've priced FB for massive earnings growth over many years and anything less will cause the price to tank. There are some great possibilities to build revenue in the future but it seems to me they don't have a concrete plan yet. Hopefully retail investors who jumped in yesterday are treating this one as a purely speculative play.
Prometheus Bound
(3,489 posts)may3rd
(593 posts)cosmicone
(11,014 posts)Drop baby drop so I can make money!
Hassin Bin Sober
(26,356 posts)cosmicone
(11,014 posts)Odin2005
(53,521 posts)fujiyama
(15,185 posts)Facebook is no pets.com and it has made money, but it's simply not a 100 billion dollar company. Also, while there is some room for expansion (mostly developing countries at this point), how many more users can the site really get? I think they already have some 10% of the world's population. Of course, being public, they'll be more forced to be profitable. But if the ads get more obstructive or harm the user experience in any way, people will likely leave. FB is still having trouble finding a suitable way to advertise on mobile platforms.
Their click rate for ads is a fraction of Google's. This is partly why GM decided to stay with Google but not continue on FB. Granted, while this whole story got a lot of coverage, GM was only paying $10 million on FB advertising - chump change to both companies.
Ultimately, I think a lot of people thought of their own facebook user experience and realized how little they click on the ads. That probably led to people wondering if the money really is there. This whole thing was so ridiculously hyped from the start. I think the stock should be priced around $12-$15 at most. Even that seems high....
magical thyme
(14,881 posts)It can't go below zero, can it?
Prometheus Bound
(3,489 posts)Brooklyn Dame
(169 posts)They were all getting away with not having to pay any taxes on this IPO -- now their greed will catch up with them. It's too bad that the rest of us who may have bought into the hype get screwed (as usual).
http://borderlessnewsandviews.com/2012/05/keeping-a-little-known-estate-tax-avoidance-strategy-under-the-hoodie/
KurtNYC
(14,549 posts)Retail investors is the industry name for suckers.
Those who sold FB short on Friday and covered yesterday (3 days) made 25% in 3 days! Now they can take that profit and short it again because the next 3 days don't look any better.
This was white collar crime and some brokers and fund managers should go to jail for it (they won't of course but they should).