Monday, May 21, 2012

Facebook Not Ready for Prime Time

Duh! Facebook CEO Mark Zuckerberg got knocked down from his pedestal. Can someone tell me the difference between Facebook and Myspace? Facebook is not a Google. Thus, get over it and take the lost.

(CNBC) Facebook shares [FB 34.06 -4.1718 (-10.91% ] sank on Monday without the full support of the company's underwriters, leaving some investors down 25 percent from where they were Friday afternoon.

Facebook's debut was beset by problems, so much so that Nasdaq said on Monday it was changing its IPO procedures.

That may comfort companies considering a listing but does little for Facebook, whose lead underwriter Morgan Stanley had to step in and defend the $38 offering price on the open market.

Without that same level of defense, its shares fell $4.50 to $33.73 in the first 1-1/2 hours of trading. That represented a decline of 11.8 percent from Friday's close and 25 percent from the intra-day high of $45 a share.

The losses wiped some $19 billion off of the company's market capitalization—not far from what Chief Executive Mark Zuckerberg was worth personally when the stock debuted. Collectively, Facebook's owners and investors have suffered more than $11 billion in paper losses, with Zuckerberg alone losing $6.2 billion.

A Facebook spokeswoman declined to comment on the share price issue.