Google+

Facebook Stock Plunged

Shares of Facebook’s stock plunged nearly 10 percent on Tuesday, closing at $28.84, a 24 percent fall since the company’s initial public offering at a price of $38 per share on May 18.

The decline came on a day when most of the market was higher, with the S&P 500 closing up 14.6 points (1.11%) while the Nasdaq was up 33 points (1.18%).

Facebook’s highly anticipated IPO was one of the largest in U.S. history, but has delivered the worst trading performance for its first five days of trading of any offering during the past decade, according to Bloomberg News.

Although part of the slumping stock price has been driven by investor skepticism about the social network, options traders are also bending the price by making bets on the future direction of the shares.

Jon Ogg of 24/7 Wall Street said there was “explosive” trade in Facebook on the first full day options were available, with a “push and pull” among investors seeking “to pick their entry point ahead of time if they are interested in buying Facebook at lower prices.”

Peter Cardillo of Rockwell Global Capital said Facebook’s slide was a result of “the combination of bad press and sell options feeding on the market.”

“It could be technical, since each time it is making new lows and it feeds on itself until it exhausts itself,” the AFP news agency quoted him as saying.

Wedbush Securities said in a note to clients that Facebook’s stock was still spinning from a “messy” public offering, which included technical glitches on the Nasdaq and worries that Morgan Stanley, the lead IPO underwriter, may have lowered its price estimates at the last minute and shared that information with select investors.
A number of lawsuits have been filed over the matter.

Wedbush also noted that the number of shares offered by Facebook in its IPO might have simply overwhelmed demand, putting downward pressure on the stock.

Other analysts say Facebook’s falling stock price reflects concerns about whether the company is truly worth its stratospheric market valuation.

But Wedbush analyst Michael Pachter and associates said they remain bullish on the company’s long-term prospects.

“Despite these near-term issues, we expect dramatic long-term revenue growth,” the brokerage said, noting that it was maintaining its $44 per share price target.

“We think that our price target is warranted due to Facebook’s huge upside potential for revenue and earnings growth.”

Facebook generates most of its revenue by selling advertising on its site.  The company took in $3.71 billion in revenue last year, with net earnings of around $1 billion.

“As Facebook enhances the user experience, we expect three things to happen,” Pachter said.

“First, we think that a better experience will lead to a greater number of users; second, we think that a better experience will lead to higher levels of engagement; and third, we think that a greater user base that spends even more time than the current user base will be an irresistible target for advertisers.”

Wedbush also cited Facebook’s market dominance as a key factor in future growth.

“Facebook has built a huge moat between it and its competitors, and we endorse [chief executive Mark] Zuckerberg’s mission (if not his wardrobe).

In a related development, the Russian-based social network Vkontake announced it was delaying its planned public offering due to the Facebook misfortune.

In a Twitter message, chief executive Pavel Durov said that Facebook’s IPO “has destroyed the faith of a lot of private investors in social networks” and that Vkontake’s IPO “has now been postponed indefinitely.”

Despite investors’ weariness over Facebook’s stock, rumors that the social network might acquire Opera Software sent shares of the Norwegian Internet browser company soaring as much as 22 percent on Tuesday.

By the close of trading in Oslo, Opera Software’s shares were still up 19.5 percent on the first day of trading since speculation of a possible Facebook acquisition broke late last week.

If a deal were to go through, it could give Facebook control over Opera’s highly regarded cellphone Web browser, pitting the social network against companies such as Microsoft, Google and Apple.

Source:  news wire redorbit

REQUEST INFORMATION

Entertainment

For movies opening August 18, 2017

  OPENING THIS WEEK Kam's Kapsules Weekly Previews That Make Choosing a Film Fun by Kam Williams For movies opening August 18, 2017 BIG BUDGET FILMS The Hitman's Bodyguard (R for graphic violence and pervasive profanity) Unlikely-buddies comedy about an ace bodyguard (Ryan Reynolds) who grudgingly helps a notorious assassin (Samuel L. Jackson) negotiate a dangerous gauntlet en route to the Hague where he's set to testify in 24 … [Read More its Good for You.....]

Lifestyle

The “King” Will Take Center Stage at the 2017 Wildlife Conservation Expo

  The “King” Will Take Center Stage at the 2017 Wildlife Conservation Expo by Amy Lignor   Each and every year the Wildlife Conservation Expo is held to address situations out there that are harming our world and its animal inhabitants. This time around, WCN’s annual Fall Wildlife Conservation Expo in October, will be focusing on various issues, but it is the King of the Jungle who will be taking center stage. For those who are … [Read More its Good for You...]

Outdoors

How Bassmaster Pro Edwin Evers Adjusts the Auto Settings on His Sonar

  How Bassmaster Pro Edwin Evers Adjusts the Auto Settings on His Sonar  by Edwin Evers When it comes to electronics, a question I get asked a lot is, “How do you customize your fish finder settings at the beginning of a day on the water?” The short answer is, “I don’t.”   You might think that a guy who makes his living with a rod and reel and who’s always looking for ways to tweak a lure or find a stronger knot would spend a … [Read More its Good for You...]

Sports

College Football Arriving Soon!

  College Football Arriving Soon! by Amy Lignor   Ask any college football fan and they will tell you that it seems like an eternity waiting for the season to begin. But, have no fear, the kick-off to the college season is almost here, with Colorado State and Oregon State hitting the field on Saturday, August 26th at 2:30 p.m. ET. On the same day, fans of Oregon State and Colorado State will see an active match-up, and Portland … [Read More its Good for You...]

Travel

Going Back in Time on the Ultimate Steamboat Vacation

  Going Back in Time on the Ultimate Steamboat Vacation by Amy Lignor   Many people love taking a cruise. But it is the river cruise on that glorious steamboat that not only offers all the benefits a big ocean liner offers, but also creates a more personalized, intimate vacation experience. It is a unique recipe: being able to witness stunning landscapes, mixed with amazing history, while dining on acclaimed regional cuisine and … [Read More its Good for You...]

Real Estate

Real Estate: Refinancing Rates on the Rise in 2017

  Real Estate: Refinancing Rates on the Rise in 2017 by Amy Lignor   The term ‘meteoric rise’ usually applies to something fun. Think: A Hollywood actor who has been ‘discovered.’) Unfortunately, when it comes to this article, ‘meteoric rise’ is something that will not bring a smile to one’s face. To put it simply, if you wish to refinance your home, you need to do it ASAP. If choosing to wait too much longer, homeowners across the … [Read More its Good for You.....]

Business

Umbrella Insurance: The Safety Net You Need

  Umbrella Insurance: The Safety Net You Need by Amy Lignor   The realm of insurance is just about the most difficult maze to get through. Each and every day it seems the financial and insurance industries are changing. What is not changing, however, is the fact that lawsuits fill up the courts more and more – lawsuits that award cash to third parties even if you don’t happen to have that cash saved. More and more, the words “umbrella … [Read More its Good for You...]

Green Living

Creating the Perfect Vegetable Garden

  Creating the Perfect Vegetable Garden by Amy Lignor   Many are still dealing with that wintery mix Mother Nature just loves to toss down from the sky this time of year. Yet, that gardener living inside the soul – the one just dreaming of the sunny skies and lazy rainy days that are must-haves in order to grow the best vegetables possible – is already jotting down the facts, tricks and tips they need to know in order to make that … [Read More its Good for You...]

Books

Book of Black Heroes

  Book of Black Heroes Political Leaders Past and Present by Gil L. Robertson, IV Foreword by Myrlie Evers-Williams Just Us Books Paperback, $12.95 80 pages ISBN: 978-1-933491-21-9 Book Review by Kam Williams “The first African-American political leaders began to serve following the Civil War...Known as Reconstruction, this period represented a window of opportunity for African-Americans... Many [Black] political leaders emerged … [Read More its Good for You...]