Facebook Stock Falls 50% Since IPO
The days of Facebook shares being heavily oversubscribed prior to their IPO seem long gone. Now it seems almost a daily occurrence that they get bashed in some way shape or form.
Yesterday they suffered as research company eMarketer slashed their earnings forecast for the company by a whopping $1 billion. This was due in large part to the continual failure of the company to address how it will make money from the growing number of people accessing the site via their mobiles. It's a situation that hasn't changed since Facebook warned of poor mobile revenues earlier this summer.
The result will not please any Facebook shareholders however as it sent stock to an all time low. TechCrunch report that the stock has now lost 50% of its value since it launched on the stock market back in May.
They reveal that in addition to the poor earnings prediction from eMarketer, analyst firm BPO Capital Markets slashed its price estimate for the firms stock by $10, from $25 to $15.
The slump sees a continuing downward trend for the stock, which hit a previous low earlier this month after early investors sold their stock on the 16th August.
Worryingly though, worse may be on the horizon as a large chunk of stock bought by early investors will be available for sale in mid-November when the next lockup period expires. Whilst the mid-August release allowed around 271 million shares to be sold, in November up to 1.2 billion could flood the market as early investors cash in. If that happens then the shares could slide yet further on the slippery slope.
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