Investors have been giving Facebook a caning after its Thursday results and wiped $10 billion off the value of the social networking giant in the last few days.
If you hadn’t listened to TechEye and actually believed that Facebook was really worth $100 billion in May, you would now have half the amount of cash you had invested.
After a whopping 17 percent slide, Facebook’s market capitalisation is now $48 billion.
Those who see the glass half full can take satisfaction in the fact that CEO Mark Zuckerberg has lost $2.3 billion over the weekend. But that will not bring as much happiness to investors that it does to us.
Zuckerberg might be wondering what Wall Street is playing at. His company managed to beat revenue expectations. However the problem is still that he can’t reassure investors about the company’s future.
Those who invested in it thinking that the company was worth $100 billion expected that it would make record growth, something which was unlikely.
We have been consulting the tarot cards and think that Facebook shares will fall to around $21 before the company stabilises.
The poo will hit the fan on August 19 when some early investors will be able to sell shares, potentially flooding the market with stock.