Facebook stock falls back to $38 after jump at open

View Photo Gallery — Facebook’s phenomenal rise: In seven years, the social networking site has grown from a project hatched in a college dorm to the largest social networking site in the world, well on its way to hitting its goal of having 1 billion users.

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By Hayley Tsukayama,

Facebook fell back to its initial public offering price of $38 around noon Friday, 30 minutes after opening for trading.
The company, which spiked as much as 13 percent at the open, debuted in what was a highly anticipated stock offering on the Nasdaq. Financial pundits were sharply divided in their opinion of whether the stock was a good buy, underscoring the debate over the value of social media and whether companies can make money off these enterprises.Volatility in the shares Friday may be a sign of that uncertainty.

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The company’s chief executive, Mark Zuckerberg, rang the opening bell for the Nasdaq index Friday morning when the markets opened at 9:30 a.m. But as the expected 11 a.m. deadline for trading to begin ticked by, trades had yet to be listed, and the Nasdaq said that it was experiencing “delays.” Trading finally began at 11:30 a.m.
A Nasdaq spokesman was not immediately available to comment on the reason behind the delay.
The first-day pop on Facebook was expected, as investors scramble to get a piece of the initial public offering. The stock hit as high as $43 per share.
Despite questions about how the company will manage to maintain and increase its revenue, investors are clearly interested in the trove of personal data that Facebook, and so far only Facebook, has to offer. And it’s that information — your information — that’s the bedrock of the company’s business model.
As the company looks to the future, it’s trying to encourage its users to bring more information into the network through its app partnerships , and it’s moving its platform to integrate with other Web sites.
By being able to promise companies a rich collection of data on what consumers tell the network they like and want to buy and how they feel about products and more, Facebook executives think they’re making a compelling advertising pitch.

(Washington Post Co. Chairman Donald E. Graham is a member of Facebook's board.)

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