Welcome back impudent worm cradlers to the #RevolverRoundtable. I’m getting worse and worse with introductions so we’re going to jump straight in and plunge the coffee (my favourite kind) for the afternoon spiel.
Financers out there already know that Facebook shares are continuing to plunge- intended -this week, with Tuesday’s (+PST) figures arriving in at a fresh low of $31, having fallen by 18% since it’s debuting stock price of $42.05. In outside-hours trading its fallen a further 25c to $30.75.
Not a whole lot of confidence from the investors, deepening the cut of it’s heavily criticised public debut last Friday, May 18. Granted we are looking at a company who’s closing networth post-debut is worth about $105 billion, toppling global giants like Amazon.com, McDonalds and industry peer icons, Hewlett-Packard and Cisco, there are still those who view the first day pop-off as somewhat of a failure.
Ok so lets shoot the skinny, mainly because I want to condense this post and save some room for Mitt Romney. Firstly the issue of Facebook and its co operating investment banks catering to supply and demand for investors. Facebook offered nearly 20% of it’s available stock to the IPO, guaging that they could meet demand. The obvious call to make, but why not swell public interest further by reducing supply and delivering first release at a higher stock price, bringing it down over subsequential releases? You could better target a larger buy-in in second and third round releases. Another little company called Google offered just 7.2% of its stock when it went public in 2004. In day one they rose 18%.
Furthermore to the critics, Facebook can be seen as a company that transcends the need to rely on its public stance and market availbality. It is easily arguable that Facebook is primary asset in shaping global populous constructs and behaviour, a company with that much social pull is not going to lose a tonne of its profit margin in investments. I would say that Zuckerberg and co. are still soaking in the incoming cash from online advertising and social app costs, and that’s not going away anytime soon (P.S. stop sending me Texas Poker and Avengers Alliance requests, it’s lame).
The one big change that Facebook will now face with having gone public is the push to delve deeper into the social infrastructure, spurring innovation which investors can put a solid figure behind. I expect to be ousted on my thread count preference by early 2013. Could you imagine how much the stock would boom with the debut of the “Dislike” button…
Want to see GOP candidate, Mitt Romney’s professional CV? President Obama, in a sting attack on what many coonsider to be Romney’s selling point, has shed light on some of his colorful past in previous business ventures. Essentially he enters into business ventures and runs them into the ground. Yes, things are getting brutal, first the roof riding dog and now the unemployed steel workers. I’ll never understand political powerplays outside of the fact that I wish I could use these tactics more often in my workplace.
Wait we did that once and the boss was ready to have us knee-capped.
Keep watching the presidential race, bound to become far more interesting in the ensuing weeks!
If nothing else, and I’m not saying this without purposely opening up a can of worms but Barack Obama has, year-by-year, had the most entertaining term in office since Clinton. Are there any takers out there for a Clinton re-term, with a parade and B-grade movie?
Data sourced from The Wall Street Journal ©2012 Dow Jones & Company, Inc. All Rights Reserved, Yahoo! Finance ©2012 The Associated Press, ©2012 The Christian Science Monitor. All Rights Reserved.