Facebook IPO Meh

[marmar]

SAN FRANCISCO (MarketWatch) — Facebook Inc. was greeted with mixed sentiment Friday morning when its shares began trading following an initial public offering that failed to land a strong first-day ‘pop’ seen by many of its Internet peers.

Facebook shares opened trading on the Nasdaq with an initial gain of more than 10%, putting the stock above the $42 mark. The shares then slipped back quickly to its $38 IPO price before bouncing back.

The stock was last trading at $40.71 — up more than 7% from its IPO price.

“I think it’s surprising that they didn’t get the pop that many were expecting,” said Arvind Bhatia of Sterne Agee. “It seems the underwriters did not leave much upside, or perhaps investors were signaling that they would buy a lot more shares than they ended up actually buying.” ...................(more)

The complete piece is at: http://www.marketwatch.com/story/facebook-starts-at-40-in-debut-then-fizzles-2012-05-18

[Romulox]

1. Wouldn't touch FB with a ten foot pole. It's its own bubble economy, imo. nt

[FSogol]

6. What did the MySpace IPO sell for?

[RagAss]

2. Maybe because they're selling "air".

[aquart]

3. Wasn't it GM that withdrew its advertising just before the IPO?

Not like that was blatant market manipulation or anything.

[TheWraith]

4. It's not surprising at all.

Facebook has annual revenue around $3.5 billion. Revenue, mind you, NOT profit. And no real long-term plan other than desktop advertising. Contrast that to Google, which has revenue around $30 billion, profit around $10 billion, and is one of the major technology drivers on the planet. And yet Google is considered by the market to be worth only twice what Facebook is. Facebook is being grossly overvalued here simply because it's popular and has a lot of users. But it's fundamentally not a very profitable business model.

[Johonny]

5. Hard to say

A terrible roll out in a down market. Might not mean much long term. Right now they're competing for investors that are seeing high dividend stocks at rather attractive prices. Do you want facebook and the promise of maybe a huge return in 20 years or several DOW stocks at a cheaper price that give you 3-5 % at a low tax rate? I think if you are buying stock ATM you're more likely buying a little for the * of it FB, but mostly buying the dip on dividend yielding stocks. Probably need to wait until the Euro-paniced market settles to see what investors really think about Facebook.