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Facebook falls below IPO price as valuations come to the fore

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Facebook falls below IPO as valuations come to the fore
The hype and hoopla surrounding Facebook and its IPO is slowly dying down, with shares of the Social Networking site falling below its IPO price on the first day without the full support from underwriters.

Shares of Facebook ended at $34.03, down from its IPO price of $38 in trading on Monday. Analysts had warned that the shares of the company were being offered at very rich valuations, but many believe that sentiments for the stock were based more on the strong brand equity that Facebook commands.

 

Facebook now being a listed company will come under greater scrutiny, and the last few days has already seen the company being critically evaluated in the media. Some have warned that the comparison with google at this stage is absurd, as the search engine company is way ahead across various parameters and has a well diversified product portfolio.

Analysts however say that a further fall in the stock could lead to some buying support as valuations would become attractive once again.

GoodReturns.in

Read more about: facebook
Story first published: Tuesday, May 22, 2012, 9:03 [IST]
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