Facebook Inc. (NASDAQ:FB) faces troubles in floating its shares over the next few months when about 2 billion Facebook Inc (FB) shares become available for sale, on release of a lock-in. While swamping the market the company’s stock will be tattered further, snatching any chances of a follow on offering of shares.
Market trend show that inside investors would prefer to sell off their FB holdings rather than hang on to them as the company seems to be unable to induce any charming sentiments.
Facebook Inc.(FB) stocks have dropped 50 percent since its debut in May at $38 a share, in an over-hyped IPO. It is sometimes the trend for companies on a fast-growth mode to go in for a secondary offering of shares but in the present situation, with investors preferring to sell the shares rather than buying them there seems to be little likelihood of it.
Facebook Inc. (FB) had devised a strategy of a timely release of its shares in order to avoid too much of its stock flooding the market at that time. However that release of the lock-in could not have come at a worse time for the stock.
According to Market Analysts expectations, the stock could suffer from the effects of this excess liquidity for up to a year.
Most certain chances of investors recouping their losses will depend on the company focusing towards regaining growth through its future strategies.