Shares in the social networking website Facebook made their debut on Friday and did not get the expected bounce.
They floated after founder and chief executive Mark Zuckerberg rang the opening bell for the Nasdaq exchange remotely from the company’s headquarters in Silicon Valley.
It is the third-largest initial public offering of shares in US history behind General Motors and Visa.
Valued at over 100 billion dollars – more than 80 billion euros – Facebook is worth more than Deutsche Bank, BMW and Adidas together.
The shares finally started trading much later than expected at 17.30 Central European Time, and immediately jumped from $38 to $45 – an 18 percent increased, but within half an hour the enthusiasm seemed to ebb and the price slipped back to $38 before picking up a bit in early afternoon trade.
The financial and internet worlds are watching with interest.
The shares were expected to shoot up on frenzied demand, especially from individual investors hoping to buy into an Internet juggernaut that touches hundreds of millions of people every day.
One analyst, Max Wolff with Greencrest Capital, said: “This is all about the future, so it really is a lottery ticket.”
He added: “The shares could initially rise and then it could go parabolic on a wave of retail investor hope. These shares are going to trade on hope. I do not know how to value hope.”
Inevitably the comparison is being made with a previous occasion when internet related companies were being traded on hope. That was over a decade ago; it turned out to be a bubble and a lot of people lost a lot of money.
Monthly active users woldwide (in millions) – Source: facebook