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onehandle

(51,122 posts)
Mon May 21, 2012, 05:40 PM May 2012

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 = new reply since forum marked as read
Highlight: NoneDon't highlight anything 5 newestHighlight 5 most recent replies
Facebook shares plunge below IPO price (Original Post) onehandle May 2012 OP
Shocking. bayareamike May 2012 #1
I would expect it to settle out at about $12. $20 at best. bluerum May 2012 #2
"I'd rather have two shares at $19 than one at $38"?? sofa king May 2012 #6
Well ]'ll be a .... bluerum May 2012 #14
Perhaps he meant ozone_man May 2012 #20
I wish I'd known that one all these years. sofa king May 2012 #21
Happy Greater Fools Day!! TahitiNut May 2012 #3
21st century vapor fad stock. n/t RKP5637 May 2012 #4
+1 I called what facebook does, "vaporservice". LOL nt Javaman May 2012 #30
I said that facebook was a big nothing wilt the stilt May 2012 #5
next time make a bet with them KurtNYC May 2012 #38
Wow. I avoided it completely thinking it would probably go nowhere, but dropping this much on the truthisfreedom May 2012 #7
ROFL! NRaleighLiberal May 2012 #8
Boo-hoo, no one "Liked" Facebook. beac May 2012 #9
Lol ! I haven't seen a Wambulance since the thick of the 2008 Democratic primaries....... TheDebbieDee May 2012 #18
Nice that this year it will only be making runs to the GOP convention and other beac May 2012 #22
What does Facebook make? RockyMtnGuy May 2012 #10
Penis enlargement ads. And other Internet search engines are catching up with Google. onehandle May 2012 #11
GM already concluded Facebook ads were worthless. provis99 May 2012 #12
they are data miners may3rd May 2012 #24
How many images of what someone had for lunch can you view? spiderpig May 2012 #35
A Rolodex and its a good one at that IMHO harun May 2012 #31
Same thing with television and radio joeglow3 May 2012 #32
only 11%? Skittles May 2012 #13
I didn't expect that big of a drop, but a drop after an IPO isn't uncommon. Ruby the Liberal May 2012 #15
Faceplant's stock price is down!?!?! Wha???? DeSwiss May 2012 #16
Hey it's cheap now. The PE is around 100!!! pa28 May 2012 #17
Down almost 25% for people who bought at the top. Prometheus Bound May 2012 #19
doubt the "LIKE" it now may3rd May 2012 #23
I shorted it at $28.50 on opening day cosmicone May 2012 #25
I thought it couldn't be shorted for 30 days? Hassin Bin Sober May 2012 #26
It can be done abroad cosmicone May 2012 #28
LMFAO!!!! Odin2005 May 2012 #27
It was priced way off fujiyama May 2012 #29
the bottom is zero magical thyme May 2012 #33
Those three underwriters are pretty creative. They may be able to work something out. Prometheus Bound May 2012 #34
Typical of Wall Street...and I'm not exactly feeling sorry for Facebook's instant milionaires either Brooklyn Dame May 2012 #36
You mean Billionaires (who fleeced those who believed the hype) KurtNYC May 2012 #37

bluerum

(6,109 posts)
2. I would expect it to settle out at about $12. $20 at best.
Mon May 21, 2012, 05:47 PM
May 2012

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

sofa king

(10,857 posts)
6. "I'd rather have two shares at $19 than one at $38"??
Mon May 21, 2012, 06:34 PM
May 2012

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.

 

wilt the stilt

(4,528 posts)
5. I said that facebook was a big nothing
Mon May 21, 2012, 06:28 PM
May 2012

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)
38. next time make a bet with them
Wed May 23, 2012, 09:34 AM
May 2012

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

truthisfreedom

(23,113 posts)
7. Wow. I avoided it completely thinking it would probably go nowhere, but dropping this much on the
Mon May 21, 2012, 06:41 PM
May 2012

second day... Just wow!

RockyMtnGuy

(83 posts)
10. What does Facebook make?
Mon May 21, 2012, 07:07 PM
May 2012

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)
11. Penis enlargement ads. And other Internet search engines are catching up with Google.
Mon May 21, 2012, 07:10 PM
May 2012

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

 

provis99

(13,062 posts)
12. GM already concluded Facebook ads were worthless.
Mon May 21, 2012, 07:18 PM
May 2012

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

spiderpig

(10,419 posts)
35. How many images of what someone had for lunch can you view?
Wed May 23, 2012, 07:27 AM
May 2012

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.

 

joeglow3

(6,228 posts)
32. Same thing with television and radio
Tue May 22, 2012, 02:07 PM
May 2012

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.

Ruby the Liberal

(26,216 posts)
15. I didn't expect that big of a drop, but a drop after an IPO isn't uncommon.
Mon May 21, 2012, 07:48 PM
May 2012

Especially one as overhyped as FB.

 

DeSwiss

(27,137 posts)
16. Faceplant's stock price is down!?!?! Wha????
Mon May 21, 2012, 07:59 PM
May 2012

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)
17. Hey it's cheap now. The PE is around 100!!!
Mon May 21, 2012, 08:07 PM
May 2012

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.

fujiyama

(15,185 posts)
29. It was priced way off
Tue May 22, 2012, 05:15 AM
May 2012

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....

Brooklyn Dame

(169 posts)
36. Typical of Wall Street...and I'm not exactly feeling sorry for Facebook's instant milionaires either
Wed May 23, 2012, 09:21 AM
May 2012

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)
37. You mean Billionaires (who fleeced those who believed the hype)
Wed May 23, 2012, 09:32 AM
May 2012

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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