Soaring Facebook reaches within 4 cents of $38 IPO price
After a rollercoaster 14 months, Facebook stock yesterday climbed to within four cents of the $38.00 price at which it was first offered for sale to the public last year, before the shambles of its IPO .
Facebook: Thumbs up!
The shares closed on Tuesday at $37.63 after climbing as high as $37.96. That was the closest it's been to its $38 initial public offering price since its market debut on May 18, 2012.
This was followed by a steep drop last summer that wiped out billions of dollars in shareholder value.
The company's debut set a record ,valuing Facebook at a huge $104 billion, more than any other U.S. company's IPO, said the San Jose Mercury News.
But the hype soon fizzled, said the Mercury News, as investors sold on warnings that Facebook had missed a crucial shift by consumers toward using mobile devices, where the company lacked the ability to show advertising.
CEO Mark Zuckerberg later vowed to remake Facebook as a "mobile first" company, by redesigning the service for iPhone and Android smartphones and creating new ad formats for mobile screens. By last week, Zuckerberg was able to report that mobile advertising contributed 41 percent of the company's $1.6 billion in ad sales for the last quarter.
Wall Street bears still feels the social network remains vulnerable to changing consumer habits, especially among fickle teens. Its fans say it hasn't yet tapped all of its potential revenue sources.
Bloomberg News said yesterday that Facebook is close to making a widely anticipated move to sell video ads later this year.