Facebook stock price crawled up a bit today. But that was insignificant. Meanwhile Facebook lawsuits rattle the largest social networking site
After five days of trading at NASDAQ, Facebook stock price has remained at the same low level where it ended on the second day of trade –around $32 per share. Many analysts are of the view that there is every chance that Facebook shares will go down, rather than go up at least in the short term.
Many longtime Wall Street observers are of the view that though Facebook investors who invested in the social networking giant’s stock with a long term-plan may succeed in making some profits, but short term investors are already losing money in the market.
Meanwhile Facebook is facing prospects of a number of lawsuits against it for malicious intent in not disclosing full information about its earning prospects in near future. Reports suggest that this information was selectively leaked to a few investors of choice, while most were left out of the loop.
In the meantime a law firm Girard Gibbs LLP has said that it has already filed a class action lawsuit against Facebook, Inc on behalf of investors who bought shares of Facebook common stock pursuant or traceable to the company’s initial public offering (“IPO”). The lawsuit has sought action against its promoters, banks and other officials who provided ‘false’ and incomplete information to the market. But this is not going to be the only and the last lawsuit against Facebook.
A Wall Street Journal report says that Facebook is among the worst big U.S. IPO starts in the last 5 Years. The report says, “There have been 23 U.S. IPOs over that size since 2007. Through the first three sessions, only asset-manager Och-Ziff Capital performed as poorly, losing 13% as well, according to Dealogic. In fact, only seven of the deals ended their first three sessions in the red, the data provider says.”
Meanwhile people are showing their disappointment with how the whole Facebook IPO exercise took place. A reader has this to say, “I feel little sympathy for those who just HAD to have those Facebook shares on the first day. $68 Billion for a company that makes nothing, and has barely even made money. Is it any wonder how we can watch our government blow $trillions on dubious programs and then keep supporting it? I don’t know when money began to be decoupled from value, but it is a fundamental malaise of our society–everyone wants to get rich quick and nobody seems to realize that someone else is getting gypped when this happens. I guess PT Barnum had it right”.
Another reader sarcastically says, “This stock is not worth any more than$10-15 .There is no justification for the current price .Congrats to all the smart money that stayed on the sidelines. Who would trust a CEO with a hoodie and little long-term experience. This company will be a forgotten business in a few years”.
In the meantime, the Facebook stock managed to crawl up a little bit. But that was insignificant compared to the sustained hammering it has got in the market so far. At the time of writing this report Facebook stock was at $32.74 per share, a gain of $.74 or 2.31% per share.