What's one of the first things you try if something isn't selling well? Did you say discounts? Of course, Facebook has to be selling poorly because it just costs too much. I think they should try out a buy one, get one deal. If you buy one share, you get the second for free. On second thought, it might really hurt the perceived value of the brand to offer such a ridiculous value.
On the serious side, Facebook does need to do something to get demand back up for their shares. It doesn't look good when the years most anticipated IPO can't even maintain its target price. In this case, Facebook's $38 per share target just isn't holding buyer's attention. Just before noon, stock was down in the low thirties. What is going on here? I though everyone wanted a piece of this company?
Some investors might have been scared off by the ridiculous communication fiasco that plagued early trading on Friday. Apparently technical difficulties caused by some pre-IPO selling threw the system into disarray and nobody knew who purchased how many stocks and at what price? Sounds kind of scary with millions of dollars on the line. Then people weren't really willing to pay much more for the shares than the $38 target price. So much for demand skyrocketing prices to $70 per share.
There has definitely been some discussion floating around the topic of lowering prices to create greater demand. By no means is it coming from anyone official, but it certainly seems to make sense to some industry analysts. The Street released a video featuring their market researcher, Stephanie Link addressing the IPO and the value Facebook offers investors at a lower trading price.
Take a look:
Obviously we can't hold this discussion without including the valuable insight of interested parties on Twitter:
Facebook closed just 23 cents above its IPO price -- $38.23. I guess it was indeed too expensive. Glad I didn't invest my life savings
Facebook IPO opens at $38 a share. If that's too expensive, you can still buy Craigslist stock in exchange for 2 used sweaters & an old sofa
16.Many investors assess that facebook IPO stock prices is too expensive. I think, yes! really!
#Facebook’s IPO price is too high. Wait for a better entry point if you want in. It’s great for traders & institutions that got in Pre IPO.