Facebook finally gets an upgrade…to hold
June 5, 2012, 6:48 PM
On Tuesday, the social networking giant’s shares lost another 4% closing at $25.87. That means the stock has now lost more than a third of its value since the May 18 initial public offering.
In a stunning turn for what was supposed to be the hottest public debuts in years, nearly half of Facebook’s market capitalization has been wiped out in a little over two weeks.
The company debuted with a valuation of $104 billion. On Tuesday, that number is down to $55 billion.
The stock also hit a new low Tuesday dipping to $25.75. And it’s already down 7% this week.
The stock did get some upbeat news on Tuesday. S&P Capital IQ raised its rating on the stock from sell to hold.
“Based on our estimates and calculations, FB has a 2013 P/E-to-growth ratio of 1.1X, which amounts to what we view as a reasonable premium to peers,” analyst Scott Kessler argued.
Still, he added, “We continue to have questions about monetization and mobile, spending on internal investment and acquisitions of third-party companies and intellectual property, and corporate governance. …. Our Qualitative Risk Assessment remains High.”
- Benjamin Pimentel