Last week Mark Zuckerberg confessed that he was unhappy about the way the shares in Facebook had slid.
But Zuckerberg was also upbeat when it came to some of the problems that the social not-working site was facing. He was particularly bullish about how he had a cunning plan to deal with mobile technology.
According to Reuters, Wall Street was impressed by his performance and shares actually went up. His 30 minute talk actually added $6.785 billion in additional market valuation for his company as shares went up to $22.
Arvind Bhatia, an analyst with Sterne, Agree & Leach told Reuters that people are starting to feel a little more comfortable.
The feeling is that if Zuckerberg got out there and talked to the great unwashed more instead of building the company things would be a little better for the company.
But the share price was helped by Facebook announcing that its nascent ad exchange was no longer in testing mode, and several advertising agencies reported encouraging early results.
For all Bhatia and Zuckerberg’s new found optimism, Facebook cannot fix the central problem that the company faces.
There is the fact that large numbers of “locked-uped” shares belonging to Facebook insiders are about to go on the market.
Then there are all those people who bought shares in the IPO who will be allowed to sell them soon.
All this should point to the share price falling within the next six months to a year. We still predict that it will stabalise at $13 a share, unless Facebook can pull out some huge profits soon.