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Is Mark Zuckerberg to blame for Facebook stock plummet?

Tuesday, 21 August 2012 09:35
BY GINA G. SCALA
NEWJERSEYNEWSROOM.COM

Not long ago, there was a feeling in the air that Facebook could do no wrong; just about everyone had a Facebook account.

Sure, there were rumblings over changes to privacy settings without letting users know ahead of time. But those committed to using Facebook to stay in touch with far away family and friends seemed to stay on top of it. Others, those who just want to share every little detail of their life, didn’t seem to care.

But the real problems came in May when Facebook IPO’s failed to make a splash. The social media company closed its first day of trading at $38 and has been consistently below ever since. Consider this, Facebook stock has traded down on 38 days, been up on 25 days and remained unchanged only once.

In fact, Facebook stock opened today at $18.75; an all-time low and half of the initial offering price, Fox News reported. Founder Mark Zuckerberg has lost about half of its worth, dropping to just under $10 billion. And the social media company has lost $40 billion in market value since May, making it the worse major IPO ever, Bloomberg reported.

Disgruntled Facebook investors hold Zuckerberg responsible for the social media company’s dismal IPO, claiming in a class action lawsuit he was aware of insider information about the stock being overvalued.

Filed by Facebook investors June 1 in the US District Court of Southern New York, the lawsuit alleges head of the multi-billion dollar IPO, the banks overseeing the float informed major clients that they were reducing revenue estimates for the social network, The Digital Spy reported.

For the first time since 2008, it has taken more than 200 days for Facebook to add 100 million new users; most of them in Asia, according to reports.

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Comments (3)
What I think
3 Tuesday, 21 August 2012 11:13
Elyse
I think the BIG BID BOYS are showing Mark Z that they think that he is a shit/punk and showing him that he is not as smart as he is.
I bought stock now and I expect to see movement both up and down. I hope I win with positive action, which I will believe will happen. www.ElyseArtStudio.com
Reply
Yes
2 Tuesday, 21 August 2012 11:04
Bob Timmions
He has said that he does not care what people think of the changes he makes to Facebook. If the majority hate it he still does what he wants. That was fine when he did not have share holders to answer to. Now that kind of thing will not work for Facebook.
Reply
Not AT ALL
1 Tuesday, 21 August 2012 10:41
Chris D.
No zuckerberg should not be blamed one little bit for this. The company initially had no choice to go public or not because there were just too many shareholders accumulating during the time it was private. When the company was private, it was worth a good 75-80 billion. Then it goes public, and Mark had mistakenly overvalued it, obviously no one had anticipated this occurring, or else all the people who had to approve of the stock price including bankers and executives would no have tried to correct it, but they all thought it was fine! And if the entire public thought it was overvalued, then why did so many people invest in an inflated stock and expect to become millionaires on the first day of the IPO? The fact is that people just want another reason to criticize zuckerberg to make him a less important of a person because people in this society just cannot stand watching others succeed, instead they use their failures as a form of joy. The blame, if any at all, should be given to alll the investors who began selling off such large portions of their stocks immediately after the IPO. Just because everyone didn't become filthy rich from it does not mean the entire public should turn against zuckerberg.
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