Facebook shares have been taking a beating ever since its May 18 debut on the American stock market. But now, it’s hit a new low, with shares dropping below $US20.
The shares initially hit the NASDAQ priced at $US38. But it’s been downhill ever since, with shares dropping 47%.
It’s an embarrassing turn of events, even with many other tech companies struggling to live up to their pre-initial public offer hype. Corporate social network LinkedIn is one of the only success stories with its price up 11%.
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The latest dip in the Facebook price comes as the company’s block is lifted on more investors selling their shares. More than 271 million shares became eligible for sale overnight.
More shares will become eligible over the coming months, with more than two billion “locked up”. Another wave is due for sale in November, and then in May 2013.
It’s a disappointing result for the company after a lacklustre financial report.
But it’s not just the company that’s hurting. There are plenty of investors in the social network that have seen their stakes fall, having been lucky to sell some shares at the $US38 price in May.
With a share price now hovering around $US20, here are just some of Facebook’s biggest losers:
Prior to Facebook’s IPO, Zuckerberg held more than 470 million shares. He sold off 30.2 million shares on the IPO date at a tidy price of $US1.14 billion.
But he still holds on to 443 million shares. And while they were worth $US16.9 billion in May, now they’re sitting at just $US8.8 billion. A disappointing fall.
Jim is the head of Accel Partners, one of the first early investors in the company. While he holds a stake through the private equity firm, he sold 3.3 million shares in May at a price of $US125 million.
He still maintains 8.4 million shares. In May that would have netted him a nice return of $US319 million. Now, that amounts to just $US168 million.
The chief executive of LinkedIn is making a killing after his own successful IPO, but Facebook tells a different story.
Back in May he sold off more than one million shares at $US35 million. But he still holds onto three million shares. At $US38 they would have been worth $US115 million. Now, they’re just worth $U60 million.
The PayPal founder is credited as being one of the first in Silicon Valley to inject money into Facebook. His $US500,000 investment turned into a $US638 million windfall when the social network went public in May.
But since then, he’s become one of the social network’s biggest victims.
Thiel still holds onto 27.9 million shares, and the news isn’t so good there. While his stake would have been worth more than $US1 billion in May, now it’s plummeted to just $US590 million.
Interestingly enough, two days ago Thiel converted more than nine million shares to Class A stock, which is more easily traded on the sharemarket. Some analysts have taken it as a sign of a lack of confidence.
The co-founder of the network won over 100 million shares in his lawsuit against the company and Zuckerberg, but holds onto just 53 million.
In May, they would have been worth $US2.18 billion. Saverin has come out better than some other investors, with his stake still at $US1.1 billion – although that drop represents a significant decline in value.
Saverin attracted criticism earlier this year when he renounced his United States’ citizenship. Some politicians attacked the entrepreneur, saying he was attempting to avoid paying taxes.
The Napster co-founder held onto 66 million shares before the IPO, although didn’t take part in the sale. That stake was worth $US2.5 billion in May – now it’s just worth $US1.32 billion.