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Facebook IPO Launch

21st May 2012 by Jennie Stamp | News & Events

After an eventful weekend for Facebook founder Mark Zuckerberg, was the Facebook IPO launch regarded as a success?

The launch did not appear to run as smoothly as had been predicted for a company the size of Facebook. Facebook priced their shares at $38 and according to The Wall Street Journal, “The stock had been widely predicted to soar on its first day. Instead, up until the closing moments of the trading session, Facebook’s underwriters battled to keep the stock from slipping below its offering price of $38 a share.”

The social network has been valued at over $100 billion, good news for Mark Zuckerberg, but is it overpriced? The Economist, opened a voting on whether FB is worth such an amount, around 80% voted “no”.

It was reported that Facebook shares fell below their $38 issue price in premarket trading. This is unnerving news for those who bought shares over the weekend, but should they be worried? It was stated by CNET that “Its shares finished the trading day at $38.27, up 0.71 percent. So in other words, Facebook’s IPO was a lot of hype for a gain of just a few pennies.”

There may have been too much pressure on Facebook. Recent events have been hyped for a while so there were a lot of expectations on the company to perform well over the weekend.

Now Nasdaq is in trouble over technical issues related to the cancellation of Facebook stock orders on its IPO launch day. This could lead traders and investors who were affected to demand some $100 million from Nasdaq. Seems like a weekend of uncertainty all round.

So, what does the future hold for Facebook?

This milestone in the life of Facebook has been on the horizon for a while, and now it has finally happened, there seems to be an uncomfortable feeling in the air surrounding it. It has been said that Facebook won’t survive the decade. When considering that 15% of Facebook’s revenue is from social gaming and Zynga, the longevity is questioned. As the leaders in social media, Facebook are always going to be scrutinised. Maybe we are all over analysing the events of the weekend, only time will tell.

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