Facebook’s IPO: What We Know Now
The image you see here is what the Facebook stock certificate looked like. But after first saying it would issue them, Facebook changed its mind on Friday and will not issue paper certificates after all.
Ownership will be recorded electronically in the Direct Registration System (DRS) instead. (Most companies have stopped issuing certificates.)
Facebook said it planned to raise as much as $16 billion from the IPO.
What exchange is Facebook on?
Facebook has chosen the Nasdaqover the New York Stock Exchange. The NYSE is widely seen as the home of the traditional “blue chip” company, while the Nasdaq’s reputation is more associated with Silicon Valley — and more to Facebook’s image.
When can investors buy?
Who handled the IPO for Facebook?
Some 31 banks are advised on the deal, but the main players are Morgan Stanley, JPMorgan Chase, Goldman Sachs, Bank of America, Barclays,and Allen & Co.
How much money is Facebook expected to raise with the IPO?
A new filing by Facebook said it expects to raise somewhere close to $16 billion. That would make it the largest Internet-related IPO on record — breaking the previous record held by Infineon Technologies (Germany), which raised $5.9 billion in March 2000.
When did investors jump in to buy Facebook stock?
The moment the stock debuted on the Nasdaq, but as noted before, there was plenty of movement on the stock before the 11 a.m. EDT scheduled opening.
Many market experts say that the problem with immediately jumping into an IPO is that insiders, such as hedge fund managers, are buying up shares that push up the price.
Normal traders are advised to wait for a couple of days for the stock price to settle back down.
The GM IPO of two years ago is cited as a recent example of seeing a stock price initially go up $6 or $7 higher than the IPO the first day, and then settle back down a day or two later.
Here's a quick look at a couple of recent IPOs and how their stocks have fared:
Yelp, developer of online games, first day of trading on March 2, 2012:
- Pricing: $15 per share
- First-day's close: $24.58, up 64 percent from IPO price
- Trading range since IPO: $19.36 to $31.96
Zynga,developer of online games, first day of trading on Dec. 16, 2011:
- Pricing: $10 per share
- First-day close: $9.50, down 5 percent from IPO price
- Trading range since IPO: $7.97 to $15.91
How big and profitable is Facebook?
It's big and profitable, but even it can have some setbacks.In an updated filing of the IPO, Facebook said growth in the number of users using Facebook on mobile devices, which is hard to monetize, "may negatively affect our revenue and financial results."
Facebook generated $1.06 billion in revenue during the first quarter of 2012, according to an updated filing for the social network's IPO. (The updated filing is part of the IPO process when a company goes public.) That $1 billion is up from $731 million a year earlier.
A "negative" for Facebook from the filling shows that while revenue was up 45 percent from 2011, it was down 6 percent quarter-over-quarter and was still weak compared to analysts' estimates of $1.3 billion.
This is the first time in at least three years that Facebook’s revenue is lower versus prior quarter, but it's obviously still a lot of money to make.
The eight-year-old firm has more than 901 million members, and nearly half a billion people around the world log into Facebook every day, according to the latest statistics. More Fortune 500 companies also have corporate Facebook pages, rather than Twitter aliases, according to Facebook.
Facebook had total revenues of $3.8 billion in 2011, with an operating profit of $1.5 billion.