Sometimes it's not always best to be first in line. That's what the many Facebook (FB) investors must be thinking. Almost a week ago, the company went public with a highly anticipated initial public offering (IPO). Everyone wanted a piece of the Facebook pie. So much so that the offering range went from $28 - $35 to $34 - $38. The IPO was finally priced at $38 a share.
In the days following the IPO, the stock price has dropped to as low as $31 and continues to go up and down. What went wrong? For starters, brokers and traders experienced technical difficulties when trying to execute orders for Facebook. Several firms immediately complained about orders being processed twice leaving clients with double the amount of stock they intended to purchase. As trading ended on Friday and opened on Monday, Facebook shares were being dumped and unloaded at a loss.
Some say that Morgan Stanley (MS), the firm heading up the IPO, priced the stock too high in the first place, deciding on $38 per share which was the highest price point in the offering range, possibly in an attempt to be greedy. Regulatory agencies are now looking in to the IPO and are in the process of determining if everything was on the up and up.
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