Analysts aren't convinced that Facebook can maintain its grip this time.
Scott Devitt of Stifel Nicolaus lowered his price target on the stock on Monday to $150 from $186, becoming the latest analyst to express skepticism. On Nov. 19, Pivotal Research's Brian Wieser reiterated his "sell" rating and $125 stock price, stressing that "advertiser concerns about morality at Facebook are real."
James Brumley, an analyst at InvestorPlace, said that the string of damaging stories are coming out at a time when Facebook's core products are already losing relevance.
"Not enough people are still interested in Facebook any longer, and they've grown particularly tired of the same drudgery — political bickering, an overwhelming number of vanity-driven posts and what feels like increasingly aggressive advertising efforts," said Brumley. "Ask the average Facebook user how they feel about the site, and the answer is along the lines of, 'meh.' It's not what it used to be."
Zuckerberg has a lot to fix.
He needs users to trust that the posts they see are real and that their data is secure. At the same time, he has to deliver fresh products to keep users engaged and open up future growth possibilities. And he has to be able to recruit and retain talent in the Bay Area, where competition for engineers is higher than ever.
But to investors, who have seen the value of their holdings plummet of late, the number one problem today is that Zuckeberg isn't accountable to anyone other than himself.
"There's nobody who Zuckerberg has to report to or listen to to ensure he doesn't make stupid decisions," said Julie Goodridge, CEO of Northstar Asset Management, which owns 23,500 Facebook shares. "There's no checks and balances."