Facebook Shares Fall Again In Torrid Third Day Of Trading

Huffington Post UK  |  By Posted: Updated: 22/05/2012 15:23

Facebook

Shares in the social network Facebook lost more than 8% in value in early trading on Tuesday.

After a difficult day on Monday, during which Mark Zuckerberg's company lost more than 11% of its value, its shares opened down again on Tuesday morning.

Trading on the Nasdaq saw it lose more than 8% before rising slightly to hover around $31.80, down 6.6% .

Facebook shares were valued at $38 each on Friday, when the company floated.

That initial public offering (IPO) valued the company at $104bn, more than Disney and McDonald's - but analysts said its shares would have fallen below their IPO price had it not been for the actions of underwriters.

Overall Facebook shares have lost 16% in value since Friday.

CEO Mark Zuckerberg, who owns 504m shares in the company, has technically lost more than $3bn in net worth over the past four days.

According to some traders the company's relatively low revenue and the tough challenges it faces in expanding the profitability of its advertising operation leave it with low prospects in the short term.

According to a Reuters report on Tuesday, analysts at Morgan Stanley cut revenue forecasts for the company just before the IPO.

That decision may have caused the shares' subsequent weak performance.

According to one investor the decision "freaked people out".

Loading Slideshow...
  • he engines of the SpaceX Falcon 9 light but fail to launch from the Cape Canaveral Air Force Station on May 19, 2012 in Titusville, Florida. The launch in the early hours of Saturday morning would have made SpaceX the first commercial company to send a spacecraft to the International Space Station. (Photo by Roberto Gonzalez/Getty Images)

  • Chelsea Pensioners open the Westland Magical Tower Garden, a 24 meter high seven-tiered garden display, at the RHS Chelsea Flower Show, in Chelsea, west London.(PA)

  • will.i.am passes the Olympic Flame to torchbearer Emma Folwer in Taunton, Somerset.(PA)

  • The Prince of Wales watches as the Duchess of Cornwall tastes a sponge cake at the St-Francis School in Saint John eastern Canada, on the second day of a four day Diamond Jubilee tour of the north American country.(PA)

  • Visitors wait in front of the entrance of the Tokyo Skytree in Tokyo, Tuesday, May 22, 2012. The world's tallest tower and Japan's biggest new landmark opened to the public on Tuesday. (AP Photo/Itsuo Inouye)

  • Workers put finishing touches on the carving wax featuring Lord Buddha during the preparation to celebrate the 2,600 years of Buddhism in Bangkok, Thailand Tuesday, May 22, 2012. (AP Photo/Apichart Weerawong)

  • An aerial view of the Mosquitia region near the remote community of Ahuas, Honduras, Monday, May 21, 2012. On Friday May 11, a joint Honduran-U.S. drug raid, on a helicopter mission with advisers from the DEA, appears to have mistakenly targeted civilians in the remote jungle area, killing four riverboat passengers and injuring four others. Later, according to villagers, Honduran police narcotics forces and men speaking English spent hours searching the small town of Ahuas for a suspected drug trafficker.(AP Photo/Rodrigo Abd)

  • Niagara Falls emergency officials rescue a man who plunged over Niagara Falls and survived in an apparent suicide attempt, Monday, May 21, 2012. The man is only the third person known to have gone over without a safety device and live. A waiting helicopter flew him to Hamilton General Hospital, where a spokeswoman says he has critical but non-life-threatening injuries. (AP Photo/Harry Rossetani)

  • An Iraqi man rides his donkey cart in a Baghdad street, in a yellow haze from a heavy dust storm which shut the capital's airport on May 22, 2012. AFP PHOTO/SABAH ARAR (Photo credit should read SABAH ARAR/AFP/GettyImages)

FOLLOW UK TECH