There was tremendous hype about the IPO of Facebook. But when one goes about the web looking at what people are saying, the vast majority of online comments are totally negative about Zuckerman, Facebook and the future exploitation of customers of that corporation due to it spying on its users and abusing them in various ingenious ways. The naysayers are correct about this IPO being a dud.
This is one comment from this story: FACEBOOK FLOP? Underwriters Forced To Prop Up Stock
By all reasonable measures, the IPO failed. The underwriters had to intervene twice to protect the $38 price. The last intervention at the close was two tranches, of 10,000,000 shares each, at the $38 price. Otherwise the close would have been under $38.
The opening price was $42.50 as marketed by the Big Derivative Beast owners such as JP Morgan and Goldman Sachs. They hoped the hyper hype would hop into the markets and lure many deluded buyers into a rush sale. But immediately, the stock floundered badly. In the end, the sellers working for Zuckerman had to prop up the sales themselves. They are now licking their wounds wondering what collapse is in store after Monday when sellers mob the board and buyers are scarce.
Most analysts are giving Zuckerberg and the big trading houses the middle finger: Facebook Stalls in Public Debut After Record $16B in IPO – Bloomberg
The shares rose 23 cents above the IPO price of $38 as of 4 p.m. in New York. Facebook sold 421.2 million shares to raise $16 billion yesterday, giving the company a $104.2 billion market value.
Underwriters bought Facebook’s stock to keep it from falling below the IPO price, people with knowledge of the matter said today. The offering valued the company at 107 times trailing 12-month earnings, more than every S&P 500 member except Amazon.com Inc. and Equity Residential…revenue growth is poised to slow for a third straight year and advertising sales haven’t kept pace with user additions.
About $1 trillion had been erased from American equity values this month after speculation Greece will leave the euro region reversed the biggest first-quarter rally since 1998, according to data compiled by Bloomberg…Facebook executives and directors planned to sell 189.4 million shares.
The bad news that GM was discontinuing its ad buys hammered this IPO pretty hard but right in the middle of the morning came this dark news: Facebook users file class action lawsuit over online tracking | The Raw Story
Users of the service have filed an “amended consolidated class action complaint” in federal court in San Jose, California, relating to allegations that Facebook has been “improperly tracking the internet use of its members even after they logged out of their accounts”.
The class action is being brought by law firms Stewarts Law US and Bartimus, Frickleton, Robertson & Gorny…The plaintiffs are citing the federal Wiretap Act, which provides statutory damages of up to $10,000 per user and they say potentially implies damages of more than $15bn if compensation is rolled out across Facebook’s user base.
Hey, I will join this lawsuit! I could use $10,000! I once did that with a general suit against a major corporation and got well over $100 so this would be ten times ten better. I am all for it. The key point is, Facebook’s fascists are tracking people ALL THE TIME all over the web! This is a huge no-no. Doing it without telling anyone. This, on top of selling personal data to spam artists is going to be the death-knell for FB.
Thilo Weichert, the data protection commissioner for the northern German state of Schleswig-Holstein, was quoted in the German daily newspaper Frankfurter Allgemeine Zeitung warning shareholders to be aware that if European privacy authorities have their way, “Facebook’s business model will implode.”
So, the Germans are now after Facebook? HAHAHA. This means German investors will avoid this IPO, too. All the news for Facebook is negative. The 100X stock valuation versus earnings is a real killer. That is so far off the mark, only two other organizations, both heading to the rocks and failure, have similar values. This information is filtering into the news, too.
I expect Facebook to be another AOL/Enron failure.
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