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Posted on 05/23/2012 7:40:34 PM PDT by TigerLikesRooster
Shareholders sue Facebook, NYSE comes calling
By Jonathan Stempel and Dan Levine
SAN FRANCISCO | Wed May 23, 2012 9:55pm EDT
(Reuters) - The fallout from Facebook Inc's messy initial public offering widened on Wednesday as shareholders sued the social network and its bankers while a trading firm revealed a massive loss on the shares and threatened to seek "remedies."
The Nasdaq stock exchange also came under further pressure as a source close to the situation told Reuters that NYSE Euronext had opened discussions with Facebook about a potential stock listing there. Nasdaq also faces litigation from angry investors.
Facebook's listing, envisioned as a crowning moment for an eight-year-old company that has become a business and cultural phenomenon, has instead turned into a legal and public relations fiasco for the company and its lead underwriter, Morgan Stanley.
Serious trading glitches interfered with the stock's opening on Friday, and subsequent revelations by Reuters that analysts had quietly reduced their revenue forecasts prior to the IPO have led to accusations of selective disclosure of material information. The shares closed at $32 on Wednesday, 15 percent below the IPO price.
(Excerpt) Read more at reuters.com ...
P!
ever go on a road trip and buy cans/bottles/jars of air at the places you visit LOL
Normally I’m a free market type, but something smells of scam about this whole IPO....
Stocks are as much of a gamble as any Vegas slot machine.
Kinda reminds you of the mob scenes at a Black Friday sale at Best Buy.
Investor greed, stockbroker greed, politician greed & now lawyer greed.
Since this is !!!FACEBOOK!!!!, we will now see weeks of cable news and celebrity TV greed as they try to milk all the audience they can from this.
Take a risk and sometimes you get burned. If they made billions like they expected you would hear nothing.
Pray for America
Well, some lost money. What can you say?
The stock market is something of a risk. Are we supposed to be shocked and awed that “Facebook” is now publicly traded stock???
As happens with any other stock, the market determines the price, based on the collective decisions of buyers and sellers. And that in turn depends on the forecasts of how profitable this business is expected to be in the future.
What if Facebook turns out to be a passing fad??? I’m older than the young people who are so excited about using Facebook, but, I’ve heard that some younger folks are getting tired of it. If the number of people using it drops, the revenues drop, and the stock price will drop as well.
This is on behalf of his buddies Goldman Sachs who are Obama-ites.
Morgan tends to lean right.
One would think that people old enough to remember the dot-bomb era of the market, where IPO’s of companies who had no profits, no hope of making a profit and were burning through VC money at a rate of millions per month would have learned something.
Alas, it would appear not.
When FB was priced, it was at a P/E of 100:1. The open of the trade was pushed back and had problems, orders failed to be filled, etc. That was just the visible part of the cluster-f*&^, and it is cause for action against NASDAQ.
Then when it came out that the three underwriters gave their institutional customers different price targets and advice than retail clients got... well, that’s when people started dialing their lawyers.
Now that it is coming out that FB’s senior management wanted the IPO priced to make them a $100B capitalization company on their first day... for no other reason than bragging rights... well, that’s when the securities litigators start salivating like Pavlov’s dog. When senior management do an IPO like that when the rest of the sector is trading at about 16 times earnings... it’s a lead pipe cinch that the share price will, without fail, go down.
There’s many different parties to sue here, all with deep pockets and clear evidence of real wrongdoing or incompetence.
Yours is the most ignorant comment I have seen in a long time. Stocks are a risk investment, not a gamble. This Facebook IPO was a no-man’s zone for any intelligent investor. The banks had to buy in to support the underwriters. They are stupid for even touching FB. Its ironic that the FB IPO could be undoing of the company. They really have no “product” to offer, and google has them beat by far regarding their only cash cow - advertising.
No that’s silly we bring our own jars
Can I ask a stupid question? How do they set the price for an IPO? Something seems way off, if those who bought at the IPO price have lost so much. How can the IPO price be so far above the market price of the stock? Why would the underwriters support an IPO price which appears to be so far above the actual market value of the company?
I finally got what I want out of them. My account is deactive. They sent me an email:
Hi Terry,
You have deactivated your Facebook account. You can reactivate your account at any time by logging into Facebook using your old login email and password. You will be able to use the site like you used to.
Thanks,
The Facebook Team Sign in to Facebook and start connecting
Sign In To reactivate, follow the link below:
http://www.facebook.com/home.php
This message was sent to terrymross@yahoo.com. If you don’t want to receive these emails from Facebook in the future, please click: unsubscribe.
Facebook, Inc. Attention: Department 415 P.O Box 10005 Palo Alto CA 94303
Just an observation....but out of 200-odd IPOs a year (at least back in the pre-2008 period)...you’d have ten that actually launched and took off, maybe forty that did a slow gain over the next six months, and the remaining 150 just kinda lingered right there or lost substantially. What I see is a bunch of folks who really understand nothing about the IPO business and the true picture of what the majority of them do.
For problem IPO’s....I’ll also point out Galectin Therapeutics (GALT) which opened in March at $9, and today is $2.08. CafePress is another one which is a big loser over sixty days....losing around a quarter of its value.
The vast number of IPOs are just not worth even talking about.
Just an observation....but out of 200-odd IPOs a year (at least back in the pre-2008 period)...you’d have ten that actually launched and took off, maybe forty that did a slow gain over the next six months, and the remaining 150 just kinda lingered right there or lost substantially. What I see is a bunch of folks who really understand nothing about the IPO business and the true picture of what the majority of them do.
For problem IPO’s....I’ll also point out Galectin Therapeutics (GALT) which opened in March at $9, and today is $2.08. CafePress is another one which is a big loser over sixty days....losing around a quarter of its value.
The vast number of IPOs are just not worth even talking about.
It seems to me that the price of Facebook stock dropped incredibly quickly in comparison to the last heavily hyped IPO that I remember (I think it was Google). The quick stock price drop suggests to me that there was not a huge feeding frenzy, and most people were cautious.
I read an analysis a couple of weeks ago that said that the Facebook IPO was quite overpriced, and that for Facebook to become worth that level of investment, it would have to become the largest multi-billion dollar company in the world. Considering that I get a plethora of emails, “R updated his status. L shared a photo. P added friends you may know,” I don’t see that Facebook has an actual valuable product.
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