After starting troubles and a lackluster debut on Friday, shares of social network giant Facebook fell below the issue price on Monday, its second trading day.
Facebook stock fell as low as US$33 in the first half-hour of trade on Monday before closing at ~US$34.03. That is down 11% from Friday’s close of US$38.23.
The stock made its debut on Friday, closing with a gain of less than 1% following technical glitches.
The rather disappointing debut and a sharp fall on Monday have sparked a few uncomfortable questions about the Facebook IPO and its future. May be it was the pre-listing hype about stronger-than-expected investor demand that killed the enthusiasm surrounding Facebook’s stock market debut.
Meanwhile, two analysts began formal coverage of the stock on Monday, with mixed reviews.
BTIG Research has set a ‘neutral’ rating on Facebook, saying that he finds the company’s current valuation “unappealing”.
Susquehanna has set a ‘positive’, or buy, rating on the stock, with a price target of US$48.
Groupon recovered its losses from Friday, while Zynga and LinkedIn each extended their losses.