Looks like Mark Zuckerberg (28) decided to marry Saturday after his IPO on Friday, to longtime sweetheart Priscilla Chan (27) at his Californian house. They had met in Harvard. It was a real insider affair it seems only 100 invited but thought they were going to an IPO/graduation party rather than a wedding.
If you look at Zucks Facebook page, you'll see he's changed his status to "married" on Saturday too. The pic above? Good photoshop? Nah, it's true.
So obviously Mark felt he had a good Friday and then a great Saturday.
For most others the Facebook IPO...hmmm bit of a disappointment?
Not if you were an early investor and got a 104 billion us dollar valuation!
Bono earned more on Friday from his Facebook investment, than he did in his whole career. Imagine.
But it is being viewed as a bit of a damp squib.
A story in Forbes for example, ran the headline "The Failure of Facebook's IPO". And the New York Post??!! Not happy as those 'Mom+Pop' share buyers showed no gains whilst Mark walked away a billionaire. At least he made their cover (fame at last)...
So what happened on Friday's IPO?
It opened at a high 38 usd (I had forecasted 37 usd) and closed at around the same price. In fact, brokers had to step in to keep it at that price as the share closed. Completely unexpected.
And the intervention was big, probably wiping out the fees to lead brokers Morgan Stanley/JP Morgan/Goldman Sachs. 176m usd in fees gets quickly eroded in an IPO when you have to support the price. Feel sorry for them? Hard to, isn't it.
Equally too, most were surprised that the Facebook IPO was considered generally so unexciting, it had a direct and bad impact on other tech stocks such as Zynga and Linkedin with their prices declining on the day.
There was a contagion effect that if Facebook couldn't deliver then maybe we're in a tech bubble. Maybe we are.
So it all ended with a small gain on the day overall - but what needs to be remembered that it did show a gain during the day of +12%. The reason the price fell (and had to be maintained) was the volume of shares that were traded. 565 milllion. A real record.
So what happened was that the initial price was probably "about right" and led to huge selling as early investors took their profit. I think too, a lot of traders held off and adopted a "wait and see" approach. They'll be trading this week and at opening Monday am. But it was the record level of selling that kept the price depressed.
So....what's going to happen this week?
I'd expect that with that known broker intervention to maintain the price and with the overall sense of the IPO being a bit unexciting, you won't see the drive into the shares that I was expecting anyway.
And that broker intervention cannot happen again so price will now be supply/demand based. This is important that those brokers are going to look to offload those shares they bought, quickly. Bringing the price under downwards pressure on Monday as it opens.
So no massive gains.
But potentially massive loses...even a bear attack.
In other words a deliberate attempt to drive the share price down.
So that's the wrong side of risk.
If you bought and didn't sell on Friday, you're in a danger zone on the balance of risk and probability. Watch what you're doing if you're holding shares early on Monday.
The Facebook IPO has gone well for the original investors and of course, Zuck. He's had a great weekend - don't let that mean you have a bad week.
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