Facebook (NASDAQ: FB) shares fell another 10% to under $29 and are off almost a quarter from their IPO price. That IPO is surrounded by scandal which ranges from glitches in the Nasdaq (NASDAQ: NDAQ) trading system to possible revelations about Facebook’s revenue forecasts from lead banker Morgan Stanley (NYSE: MS) to some large investors.
None of these are important to most investors as is the question of how far the stock can fall. There is a school of thought that a $20 floor represents a valuation at which Facebook is pegged more closely to other huge tech firms.
That valuation could be supported by estimates as to where the stock will fall if earnings from the second quarter are well below expectations. For the time being, very few experts and analysts have been making the case that Facebook should trade much higher.
Douglas A. McIntyre
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