Facebook's IPO Investors Should Have Invested in Yahoo!
Back in February 2012, when Facebook announced its plans to go public, the tech world immediately went crazy. The hype was enormous over what should become one of the biggest IPOs of all time. On May 18, Facebook started trading at $38, giving the company an implied valuation of $104 billion. But what was supposed to be a sure shot investment, turned out to be a dud.
On its first trading day, the stock closed just above its IPO price but only thanks to the company’s underwriters, led by Morgan Stanley, who bought heavily to keep the stock above its offering price. The next week, Facebook’s stock began crashing and it did so until it hit rock bottom at a price of $17.73 on September 4. Those who had bought shares at the offering price of $38 had lost 54 percent of their initial investment in less than four months.
After Facebook’s biggest lockup expiration in November did not entail the feared fire sale, Facebook’s stock slowly started to recover. Carried by decent results and the introduction of mobile advertising products the stock gradually climbed back up, but, at $26.13, it is still closer to its all-time low than it is to its IPO price.
Those who bought Facebook shares at $38 are still down 30 percent and there are countless investments that would have yielded better results over the past year. Remarkably, even AOL and Yahoo, both internet companies of the first generation that had already been pronounced dead, would have been much better investment choices than the overhyped Facebook IPO. Had one invested $1,000 in Yahoo shares a year ago, one would hold $1,787 today, instead of the lousy $688 that Facebook’s early investors have left.
- Leading product brands with the most fans on Facebook in February 2015 (in millions)
Most popular product brands on Facebook 2014
- Facebook's annual revenue from 2009 to 2014 (in million U.S. dollars)
Facebook's annual revenue from 2009-2014
- Number of monthly active Facebook users worldwide as of 4th quarter 2014 (in millions)
Number of monthly active Facebook users worldwide 2008-2014
- U.S. corporate stocks - foreign holdings by countryU.S. corporate stocks - foreign holdings by country
- Leading exchanges globally 2013-2013, by equity capitalizationLeading exchanges globally 2013-2013, by equity capitalization
- Largest stock price among marijuana businesses in the U.S. June 2014Largest stock price among marijuana businesses in the U.S. June 2014
- Who may use the "Chart of the Day"?
- The Statista "Chart of the Day", made available under the Creative Commons License CC BY-ND 3.0, may be used and displayed without charge by all commercial and non-commercial websites. Use is, however, only permitted with proper attribution to Statista.
- Which topics are covered by the "Chart of the Day"?
- The Statista "Chart of the Day" currently focuses on two sectors: "Media and Technology", updated daily and featuring the latest statistics from the media, internet, telecommunications and consumer electronics industries; and "Economy and Society", , which inlcudes current data from the United States and around the world relating to economic and political issues as well as sports and entertainment.
- Can Statista create customized charts?
Absolutely! For information on tailor-made and sector-specific
Charts of the Day, please contact Jan Ahrens