Why Facebook Stocks Are Falling

Why Facebook Stocks Are Falling
Why Facebook Stocks Are Falling

Video: Why Facebook Stocks Are Falling

Video: Why Facebook Stocks Are Falling
Video: Here's what investors should do with their Facebook shares 2024, November
Anonim

Facebook is the largest international social network, currently with 955 million users. It was after the creation of Facebook that the triumphant march of social networks began across the planet. However, despite the worldwide fame, the value of the company's shares is falling.

Why Facebook stocks are falling
Why Facebook stocks are falling

Facebook is a major internet tycoon. Its creator and leader, Mark Zuckerburg, as well as his closest associates were recognized as the youngest millionaires, and the value of the company itself was estimated at $ 50 billion in 2011. The social network is constantly evolving, applying new technologies and offering its customers improved design and convenient functions for managing their page. However, judging by the value of the securities, Facebook does not inspire confidence in investors.

On May 18, 2012, Facebook entered the official securities market, listing the share price at $ 38 per share. However, the shares of the largest social network could be purchased on the over-the-counter markets for four years. There, their value during the sales period managed to increase 13 times, so the company did not pay enough attention to the official market, where its revenues were significantly lower.

Investors are in no hurry to buy Facebook shares, as they do not see a clear plan for further actions to develop the social network. The corporation itself plans to increase its revenues in the near future due to the release of a mobile version of the server, but this innovation does not seem attractive to shareholders.

Conflict with Yahoo! also played a role in lowering the value of securities. In February 2012, the concern accused Facebook of infringing ten patents related to advertising on the Internet. A trial soon followed. Facebook has filed a counterclaim, but the incident had a negative impact on its image.

A torn contract with General Motors also added fuel to the fire. The largest US auto concern announced the termination of cooperation with the social network.

As a result, since the beginning of trading, the value of Facebook shares has fallen three times, and experts believe that this is not the limit for the fall.

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