Facebook’s IPO did not mark the stock market as per investors’ expectation, but on the first day of trading company shares end on a low of $38.23 and raised as much as $18.4 billion in one of the biggest initial public offerings in U.S. history.
The eight-year-old social network site’s share value rose up 11 per cent and rose to $45 in starting and after that fall down at $38.23, 16% above the company’s initial pricing of $38.
There was a delay of about half an hour due to a technical glitch for Facebook to debut on the Nasdaq exchange on the first day of trading that drove up anxiety levels.
Source said that while asking about delay, the Nasdaq later said it intended to reach a resolution for orders entered in that period through an “offline matching process”.
However after normal processing of trading, more than 566 million shares in the company changed hands, a record volume for US market debuts.
Later as rang Nasdaq’s opening bell, Mark Zuckerberg, the world’s largest shareholder and his team at Facebook appeared in front of fanfare via a video link from a celebration at the company’s Menlo Park headquarters in California.
The No.1 social networking site, Facebook is trading at 108 times its earnings in the 12 months through March, 18 times more for Google, the major rival in part of advertising revenue.
With the $38 share price the company has a market capitalisation of $104.81 billion, but one reason that make it far away from most expensive site – for each users how much value of it in the market places. Although Google went public in 2004, but still values at $172 and seven times higher to make $35 in revenue for each user.
Meanwhile, the market may be not as per Facebook at the first-day of trading, that’s why Facebook lost its investors’ expected level of producing enormous profits of $105 billion. Though company worth is less than expected, around $ 25 billions, but there is more expectation for a very long time.
