Thursday, August 16, 2012

Lockout period over for Facebook shares… where is the bottom?


Today, Facebook's stock fell to a price that is all time low since its IPO, clsoing today at a price of $19.87. Today, 271.1 million shares that were locked up with insiders and institutional investors were freed up for sale and many of those induviduals decided to go ahead and sell those shares. There are even more concerns since a lock up on 243 million shares will be removed on mid October and 1.2 billion shares will be freed up on November. Many analysts are expecting a huge sell off in the next couple of months of facebook shares and some say that the stock can fall to a single digit figure by the end of the year. The company has received some major criticism for its lack of ability to generate significant amount of revenues via its mobile app. The company also said earlier this week that it’s testing a service that lets companies put more ads on mobile phones and it would be very interesting to see whether facebook would be able to monetize its large mobile user base as that is the big question in facebook's growth prospects.

http://www.bloomberg.com/news/2012-08-16/facebook-freeing-60-percent-more-shares-seen-weighing-on-stock.html

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