Facebook Inc. (NASDAQ: FB) shares continued to slide in trading on Wednesday, hitting yet another record low.
FB shares fell 3.82% to finish at $20.88 in trading on Wednesday. The stock touched an all-time low of $20.84 on Wednesday. FB shares are now trading 45% below their IPO price of $38 per share.
Facebook shares have been falling since last week, when the social networking giant reported its quarterly results. Although FB’s second-quarter results were in-line with analysts’ estimates, investors were expecting more from the company. Investors were also disappointed that the company did not provide any revenue or earnings guidance.
Facebook completed its much-awaited IPO in May this year. However, the IPO turned out to be a huge disappointment, with the stock continuing to slide since its trading debut. There are also increasing worries over FB’s advertising revenue growth.
The slide in FB shares could continue as employees will be allowed to start selling their shares this month.
Facebook had reported second-quarter revenue of $1.18 billion, which beat Street estimates. The company had 955 million users at the end of the second quarter, compared to 901 million users at the end of the previous quarter.
These numbers look good. However, investors are worried about FB’s advertising revenue, which has not grown as fast as analysts were expecting. Advertising revenue grew 32% in the second quarter. Advertising revenue grew 45% in the first quarter of 2012.
In a report released last week, Morningstar said that FB’s shares could continue to slide for the next several quarters. Morningstar expects further near-term disappointment and encouraged investors to consider an even wider margin of safety before making an investment.
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