Facebook Stock Value Drops for Third Day
In its third day of trading, Facebook's stock is still in a slump, taking the shine off the frenzy that led up to the company's initial public offering (IPO) last week.
After closing just slightly above $34 a share on Monday, the company's stock was trading at below $31.50 per share a half hour before the market close. The high for today was $33.59 a share.
Since the stock was first offered at $38 per share last Friday, the ensuing price dip has disappointed the market. Some financial analysts had predicted the stock price would quickly shoot to $50, $60 or even $90 a share.
"This is very bad for Facebook short-term, mid-term, and even long-term," said Patrick Moorhead, an analyst with Moor Insights & Strategy. "In this new age, many people see stock-price and even IPO performance with determining how well the company is actually doing.... Facebook stock is absolutely, categorically struggling right now."
Zeus Kerravala, an analyst with ZK Research, said that despite the huge build-up in the months before Facebook's IPO, investors simply haven't been as excited about the stock, or the company's business, as anticipated.
"What a mess Facebook's IPO has been," he added. "The stock continues to fall and there's lots of finger pointing about why. And Facebook doesn't want to be the next Groupon, but they might be headed that way."