Barron's slams Facebook, stock plunges
Magazine says Facebook shares are still overpriced
Computerworld - Any boost Facebook got a few weeks ago from CEO Mark Zuckerberg's first public comments since the company went public, seem to have dissipated.
The social network's stock price took a quick tumble today, dropping by about 10% just after noon ET to hit a low of $20.36. The stock had a high today of $21.98.
At 4:15 p.m., the stock was priced at $20.80 per share.
The slide triggered what is called a short-sale circuit breaker on the Nasdaq. The circuit breaker, which was devised by the U.S. Securities and Exchange Commission, is designed to protect a stock from being played by short sellers.
The circuit breaker will remain in effect through the end of trading on Tuesday.
The drop in Facebook's stock price came the same day that financial magazine Barron's published an article saying that the social network's stock remains overpriced, even though it is well off its opening price of $38 per share.
"What are the shares worth? Perhaps only $15," according to Barron's.
Ezra Gottheil, an analyst with Technology Business Research, said he wouldn't be surprised if the Barron's article was behind today's turbulence.
"I'm sure anything could spook the market. It's like a herd of elephants. Eek, a mouse!" he said. "I know there was a lot of hysteria when it went public. I think people bought in a fever, and are having regrets. But the regrets may be as outsized as the enthusiasm."
Sharon Gaudin covers the Internet and Web 2.0, emerging technologies, and desktop and laptop chips for Computerworld. Follow Sharon on Twitter at @sgaudin, on Google+ or subscribe to Sharon's RSS feed . Her email address is email@example.com.
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