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Friday, August 31, 2012

Why Facebook stock prices down 8/31/2012

Why Facebook stock prices down 8/31/2012, Zynga shares prices : Shares of Facebook Inc (FB.O) fell 4.5 percent to a new low on Friday after BMO Capital Markets cut its price target on the social networking company's shares, saying several lock-up expirations over the next year will weigh on the stock.

BMO Capital Markets, which cut its price target by $10 to $15, said Wall Street sentiment on Facebook is now much worse than advertiser sentiment.

Bank of America Merrill Lynch slashed its price target for social networking site Facebook ($18.38, -$0.71, -3.74%) to $23 from $35, though it backs its neutral rating. The firm cites more looming lock-up expirations for the cut. "Facebook has multiple lock-up expirations over the next year and recent selling activity on the August lock-up suggests to us the risk of future selling pressure," the firm wrote in a note to clients. It added that the biggest lock-up date is 11/14 (40% of shares eligible for sale), "and we wouldn't expect stock to see buying momentum until December."

We expect investor attention to return to fundamentals after the technical challenges presented by lock-up expirations over the next six months have been absorbed by the stock, Shares of the company fell to $18.23 on the Nasdaq on Friday amid heavy trading.

Shares of game publisher Zynga Inc (ZNGA.O), which gets most of its revenue from Facebook, slipped 3 percent on the Nasdaq.

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