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Mon May 21, 2012, 05:40 PM

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

38 replies, 4835 views

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Arrow 38 replies Author Time Post
Reply Facebook shares plunge below IPO price (Original post)
onehandle May 2012 OP
bayareamike May 2012 #1
bluerum May 2012 #2
sofa king May 2012 #6
bluerum May 2012 #14
ozone_man May 2012 #20
sofa king May 2012 #21
TahitiNut May 2012 #3
RKP5637 May 2012 #4
Javaman May 2012 #30
wilt the stilt May 2012 #5
KurtNYC May 2012 #38
truthisfreedom May 2012 #7
NRaleighLiberal May 2012 #8
beac May 2012 #9
TheDebbieDee May 2012 #18
beac May 2012 #22
RockyMtnGuy May 2012 #10
onehandle May 2012 #11
provis99 May 2012 #12
may3rd May 2012 #24
spiderpig May 2012 #35
harun May 2012 #31
joeglow3 May 2012 #32
Skittles May 2012 #13
Ruby the Liberal May 2012 #15
DeSwiss May 2012 #16
pa28 May 2012 #17
Prometheus Bound May 2012 #19
may3rd May 2012 #23
cosmicone May 2012 #25
Hassin Bin Sober May 2012 #26
cosmicone May 2012 #28
Odin2005 May 2012 #27
fujiyama May 2012 #29
magical thyme May 2012 #33
Prometheus Bound May 2012 #34
Brooklyn Dame May 2012 #36
KurtNYC May 2012 #37

Response to onehandle (Original post)

Mon May 21, 2012, 05:41 PM

1. Shocking.

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Response to onehandle (Original post)

Mon May 21, 2012, 05:47 PM

2. I would expect it to settle out at about $12. $20 at best.

FB is worthless imo- but W.C. Fields has it right.

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Response to bluerum (Reply #2)

Mon May 21, 2012, 06:34 PM

6. "I'd rather have two shares at $19 than one at $38"??

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.

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Response to sofa king (Reply #6)

Mon May 21, 2012, 07:42 PM

14. Well ]'ll be a ....

Will have to track that one down.

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Response to sofa king (Reply #6)

Mon May 21, 2012, 08:23 PM

20. Perhaps he meant

It's morally wrong to allow a sucker to keep his money.
- W. C. Fields

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Response to ozone_man (Reply #20)

Mon May 21, 2012, 08:39 PM

21. I wish I'd known that one all these years.

It explains why I'm poor.

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Response to onehandle (Original post)

Mon May 21, 2012, 05:51 PM

3. Happy Greater Fools Day!!


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Response to onehandle (Original post)

Mon May 21, 2012, 06:00 PM

4. 21st century vapor fad stock. n/t

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Response to RKP5637 (Reply #4)

Tue May 22, 2012, 08:47 AM

30. +1 I called what facebook does, "vaporservice". LOL nt

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Response to onehandle (Original post)

Mon May 21, 2012, 06:28 PM

5. I said that facebook was a big nothing

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.

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Response to wilt the stilt (Reply #5)

Wed May 23, 2012, 09:34 AM

38. next time make a bet with them

or sell short. I made good money betting against Clinton's impeachment and resignation that way, and it shuts them up.

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Response to onehandle (Original post)

Mon May 21, 2012, 06:41 PM

7. Wow. I avoided it completely thinking it would probably go nowhere, but dropping this much on the

second day... Just wow!

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Response to onehandle (Original post)

Mon May 21, 2012, 06:56 PM

8. ROFL!

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Response to onehandle (Original post)

Mon May 21, 2012, 06:59 PM

9. Boo-hoo, no one "Liked" Facebook.

See outside Facebook headquarters:

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Response to beac (Reply #9)

Mon May 21, 2012, 08:13 PM

18. Lol ! I haven't seen a Wambulance since the thick of the 2008 Democratic primaries.......

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Response to TheDebbieDee (Reply #18)

Mon May 21, 2012, 08:49 PM

22. Nice that this year it will only be making runs to the GOP convention and other

Republican events.

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Response to onehandle (Original post)

Mon May 21, 2012, 07:07 PM

10. What does Facebook make?

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.

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Response to RockyMtnGuy (Reply #10)

Mon May 21, 2012, 07:10 PM

11. Penis enlargement ads. And other Internet search engines are catching up with Google.

They will both end up with myspace and pets.com.

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Response to RockyMtnGuy (Reply #10)

Mon May 21, 2012, 07:18 PM

12. GM already concluded Facebook ads were worthless.

 

But Facebook defenders are about as delusional about the value of that product just as much as Apple defenders are.

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Response to RockyMtnGuy (Reply #10)

Mon May 21, 2012, 09:16 PM

24. they are data miners

 

and people LOVE sharing their most intimate secrets with big brother.

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Response to may3rd (Reply #24)

Wed May 23, 2012, 07:27 AM

35. How many images of what someone had for lunch can you view?

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.

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Response to RockyMtnGuy (Reply #10)

Tue May 22, 2012, 08:52 AM

31. A Rolodex and its a good one at that IMHO

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Response to RockyMtnGuy (Reply #10)

Tue May 22, 2012, 02:07 PM

32. Same thing with television and radio

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.

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Response to onehandle (Original post)

Mon May 21, 2012, 07:38 PM

13. only 11%?

that's the only real surprise

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Response to onehandle (Original post)

Mon May 21, 2012, 07:48 PM

15. I didn't expect that big of a drop, but a drop after an IPO isn't uncommon.

Especially one as overhyped as FB.

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Response to onehandle (Original post)

Mon May 21, 2012, 07:59 PM

16. Faceplant's stock price is down!?!?! Wha????

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

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Response to onehandle (Original post)

Mon May 21, 2012, 08:07 PM

17. Hey it's cheap now. The PE is around 100!!!

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.

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Response to onehandle (Original post)

Mon May 21, 2012, 08:20 PM

19. Down almost 25% for people who bought at the top.

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Response to Prometheus Bound (Reply #19)

Mon May 21, 2012, 09:15 PM

23. doubt the "LIKE" it now

 

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Response to onehandle (Original post)

Mon May 21, 2012, 09:28 PM

25. I shorted it at $28.50 on opening day

Drop baby drop so I can make money!

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Response to cosmicone (Reply #25)

Mon May 21, 2012, 11:49 PM

26. I thought it couldn't be shorted for 30 days?

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Response to Hassin Bin Sober (Reply #26)

Tue May 22, 2012, 02:59 AM

28. It can be done abroad

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Response to onehandle (Original post)

Mon May 21, 2012, 11:58 PM

27. LMFAO!!!!

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Response to onehandle (Original post)

Tue May 22, 2012, 05:15 AM

29. It was priced way off

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....

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Response to onehandle (Original post)

Tue May 22, 2012, 09:00 PM

33. the bottom is zero

It can't go below zero, can it?

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Response to magical thyme (Reply #33)

Tue May 22, 2012, 09:09 PM

34. Those three underwriters are pretty creative. They may be able to work something out.

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Response to onehandle (Original post)

Wed May 23, 2012, 09:21 AM

36. Typical of Wall Street...and I'm not exactly feeling sorry for Facebook's instant milionaires either

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/

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Response to Brooklyn Dame (Reply #36)

Wed May 23, 2012, 09:32 AM

37. You mean Billionaires (who fleeced those who believed the hype)

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).

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