Facebook falls to half of public offering price

[Omaha Steve]

Source: AP-Excite

NEW YORK (AP) - Facebook's stock fell to $19 for the first time on Friday, losing half its market value since the company's initial public offering in May.

The stock dipped 87 cents, or 4 percent, to briefly hit $19, just minutes before it closed the trading day at $19.05. Facebook's shares ended the week down nearly 13 percent.

Facebook hit the $19 milestone a day after the expiration of a lock-up period that had previously prevented some early investors and insiders from selling their shares. Stakeholders who owned a combined 271 million Facebook shares before Thursday can now sell their holdings.

A breakdown of just how many major Facebook Inc. (FB) shareholders sold their stock this week won't be available until next week at the earliest, when sellers must disclose such transactions.

FULL story at link.


Read more: http://apnews.excite.com/article/20120817/DA0NCRJG0.html

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A Facebook worker waits for friends to arrive outside of Facebook headquarters in Menlo Park, Calif., Friday, Aug. 17, 2012. Facebook stock is trading at $19 and has lost half its market value since its May public offering. (AP Photo/Paul Sakuma)

[kestrel91316]

1. Cool. When it drops to penny stock status I might buy a few thousand shares just

for the hell of it, lol.

[Fuddnik]

2. The sheep got sheared/

[Liberal_in_LA]

11. they sure did

[vkkv]

15. Everyone's Facebook pages are simply not worth that much.

Mediocrity in our mod-lite society just might lose for once!

And the dull, personal facts about the users habits and where they surf just does't have that "it", you know?... market value.

[virgogal]

3. I hope this is the beginning of the end. I detest Facebook.

[bupkus]

18. +1

[ChairmanAgnostic]

20. my feeling as well. I just cannot describe why, exactly.

there is something . . . wrong with that setup. I've been on other social networks, and none of them leave me with such a bad taste in my mouth.

[Skittles]

26. I am sick sick SICK of facebook

cannot BELIEVE so many people fell for it

[RKP5637]

27. +1, FB seems so invasive. I don't group up with the guppies too well and with

all respect to users that seems IMO to be what FB does.

[onehandle]

4. Google will fail next.

They make nothing but spam ads. Same as Facebook.

[Occulus]

5. No, Google does one hell of a lot more than that

I'll agree that Google has its tendrils in deep too, but nothing at all to the extent Facebook does.

[onehandle]

6. Facebook is a fad. Google is attempting to own the Internet.

They are testing the waters of being data pipeline and data controller.

They need to be broken up.

[JackRiddler]

7. Pretty much.

Except the fads have united in recent years. There is an informal cartel pumped up by the media and corporate cross-promotion. Plus, people like to have it simple. Facebook, Twitter, the Google properties including Youtube, tumblr and a few others are supposed to be it.

But anyway, Facebook as a business ain't really worth much. Total hype, like AOL in its time. Depends what they buy with the swag they just made.

[onehandle]

19. One of the smartest Googlers from the time when they did innovation just became Yahoo's CEO

And I think that's significant.

Google's practical/successful properties are search, gmail, and video. All monetized by ads. Android is a loss leader.

They are trying desperately to win at social, but Google+ is a ghost town.


My biggest problem with them is their data spying/mining. They have lost their way and headlines about fines for their practices are making people think twice about paying for their services. As long as they give services away, they will make money. Until better services come along, which will happen.

They are trying to get us to pay them, and people don't want to pay. Now they are trying to launch their own Internet provider service. I have a real problem with one company owning the data infrastructure and the data pipe.

[ChairmanAgnostic]

21. goggle+? hmm. never heard of it. Ooops, GOOgle.

[David Zephyr]

24. You can yahoo her.

You can "yahoo" the new CEO. She's Marissa Meyer and she is friggin' brilliant.

[David Zephyr]

23. Savy observation, onehandle. Yahoo's sitting in a very good position now.

I yahoo now as much as I google. Yahoo can be a verb, too.

Marissa Mayer is brilliant.

[BlueStreak]

10. Facebook and Google are opposites. The Wall Street sheep herd never understood that. They still do

Google has a very viable revenue strategy because of a simple proposition. People go to Google when they are looking for things, looking for products, looking for information. That's what Google does. It is a sensible proposition to advertise on Google because there is a good chance that the person is searching on Google with the intent to make a purchase decision. My experience with Google ads in a travel industry setting was a 5% conversion rate. That is to say, if I paid $1.00 per click on Google, then that would cost me $20 per actual customer. Expensive, but a reasonable business proposition, and less than commissions through some other agencies.

Facebook is nothing like that. People are on Facebook for mostly narcissistic reasons. To some extent they are wanting to interact with others, but most of it is just vanity. There seems to be no limit to narcissism -- that seems to be infinite. But it does not translate to any sensible advertising model. The conversion rate is so close to zero that we might as well call it zero. If I spend even 10 cents per click on Facebook ads, it would probably cost me hundreds of dollars for ever actual paying customer that came from Facebook.

There is nothing Facebook can do to change that cruel reality. Facebook isn't a search engine. It is an electronic mirror. "Mirror mirror on the wall ..." Perhaps somebody advertising Botox or boob jobs would find Facebook ads to work, but that isn't enough to save Facebook.

[AntiFascist]

25. CIA venture funding started up Google...

how come this fact is no longer available when you "Google" it?

http://www.businessinsider.com/25-cutting-edge-companies-funded-by-the-central-intelligence-agency-2012-8?op=1#ixzz23w9ajslV

"What we didn't go into as much was the fact that In-Q-Tel was an early investor in the technology on behalf of the Central Intelligence Agency.

Palantir makes software that integrates data together from a wide array of resources and databases.

It's one of the best programs at coordinating the vast databases accumulated by the U.S. intelligence apparatus. It assembles comprehensive dossiers on objects of interest, collated from the sprawling databases of intelligence agencies."

[RKP5637]

28. Exactly!!! And, I'm always amazed at how many don't understand that what is

free on Google comes with a lot of strings attached, tentacles into vast privacy invasion and many willingly click away and enter vast amounts of personal information, traits, trends, interests, etc., etc. into Google and the like.

I also have a suspicion that Google drops a lot of results out of searches as not intended for serf consumption. I don't have the results in front of me, but often I've looked for things in Google that don't seem to be there anymore. I've done no proactive searching for this, but just a nagging sixth sense telling sometimes what I've seen over the years is now gone.

Also, sometimes, my technical searches present me with pages and pages of ads. I realize this is important for their revenue, but sometimes it seems a bit overbearing.

[AntiFascist]

30. Case in point...

many of the previous DU postings about questionable seed funding of Google no longer seem to be accessible. I know there was even a legitimate article, I think on C-Net about this...but now seems to be scrubbed.

[malokvale77]

31. Exactly...

Yesterday I was searching for an article I had read that connected a Swedish banking family with Julian Assange and Eric Holder. I had seen it about a month ago and now it has disappeared.

[JackRiddler]

36. And Peter Thiel of In-Q-Tel was the key VC "angel" for Facebook.

Small world.

[crimson77]

8. I have never clicked on one ad on Facebook.

That is the problem they face. I used to love Facebook when it first came out. Now, it is just something I check once a day. There are only some many baby pictures, lunch pics and peoples political rants. If I want a political discussion I will come hear or Kos. I don't need it from some kid I kind of know who friended me from high school.

[XemaSab]

9. I'm the only person on a social networking/blogging site who will admit to liking facebook?

I have three major circles there: people I know from real life, people I know from other places on the internets (including DU), and other bird nerds.

Where else would I learn that "Mitt Romney and Paul Ryan" is an anagram of "My ultimate Ayn Rand porn?"

I suspect that people who don't like it don't have the right friends.

[Liberal_in_LA]

12. I hate facebook

[jsr]

13. Where is the button for like this thread

and tell the little scammer to go Zuck himself.

[SunSeeker]

14. Suckers. nt

[iamthebandfanman]

16. lol

wish i could say i didnt see this coming

[sendero]

17. As much as I hate Wall Street..

.... anyone foolish enough to believe that Facebook was worth anywhere near the IPO price deserves to be separated from their money.

[banned from Kos]

22. A good growth company like FB should be worth 20x earnings.

2013 eps = .63c.

20 x .63 = $12 ish per share. (still too high)

[BlueStreak]

33. Absolutely. That should be the starting point for valuation.

Instead most of the analyst jokers are still going with the PE based on the fictitious "expected future earnings" which will not materialize in Facebook's case. In the US, the engagement level has already peaked and is going downhill. There is still growth in third world countries, but these aren't going to be as attractive to advertisers for years.

Most analysts are hanging their hat on the mobile monetization problem (there aren't enough pixels on cell phones for a lot of ads, and people really don't want their cell phone cluttered with ads. But the Facebook problems are more fundamental, and really have very little to do with mobile.

It is just a business case that never made sense.

[DontTreadOnMe]

29. I heard MySpace is coming back into fad!

The sheep got sheared... total suckers.

[TeamPooka]

34. "Like"

[Sabriel]

35. I'm experiencing Schadenfriende

The joy one takes in others' Facebook investment mistakes.

[petronius]

37. So a super-hyped company that produces basically nothing and which lost a big

advertising client shortly before the IPO turned out to be worth a lot less than its owners wanted (and managed) to sell it for? I'm having trouble figuring out how this qualifies as 'news'.

Sucks for the people who have - in the short term at least - lost, but I think the lesson has been known for a decade and more that "internet business!" =/= "free money!"...

[MrSlayer]

38. This was a sucker bet from the door.

I wish I knew how to bet against stocks, I would have cleaned up.