There's a chance of Facebook being admitted into the Nasdaq 100 from August 18th, as Nasdaq changed the rules to 3 months to entice Facebook to list with them. So after the fiasco of the opening day and dire three months of trading so far I'm sure Nasdaq will be keen to give them a chance to get some of the pension fund money and index trackers that only buy the stocks in the large indexes. After all institutional money is what really moves stocks the most.
So I'm waiting to see if it gets into the Nasdaq 100 in the next week or so, as that would open up a much larger pool of capital for them and help stabalise it possibly.
Yesterday the n.o of shares available to trade increased by 60%. I think the increase was 279million. Get this though..... in November the employees, who are sitting on massive unrealized gains, can sell more than 1 BILLION.
Here is the rest of Facebook's lock up schedule (in million) :
What it means is : starting october 15 and going into 2013 there will be more and more shares avalaible to sell.
There was only 421 millions shares available in the starting IPO (+ 271 millions on the 8/16/2012) and the price already crashed.
More than 1,7 billion shares will hit the market in the coming months (most of them are equity from employees that will be free to sell on 11/14/2012).
What do you think will happens when the number of shares avalaible for sale will go from 700 millions to more than 2 billions in a short period of time ?
FB started at around 100 x earnings. Now it is around 60 x earnings. With your average company trading around 15x earnings, it can go a lot lower. In my book, anyone buying FB before 2013 and the end of the lock up period is crazy.