Thursday, August 9, 2012

Facebook Inc (NASDAQ:FB) Resumes Fall on Uncertainty Risks

Facebook Inc(NASDAQ:FB) shares which have been at the receiving end of investors' selling saw no respite on Wednesday as it continued its downward trend with no positive news to reverse sentiments.

The stock closed flat at $20.72, off session low of $20.22 on Wednesday after slumping 5.50% in the prior session. The stock has now shaved off nearly half its value since its IPO in May.

What Technical Charts Suggesting About FB. Get Free Trend Analysis

In its 10-Q filing with the U.S. Securities Exchange Commission the world's No.1 social networking site had expressed its apprehensions over a shift to mobile advertising hitting its revenue growth as mobile ads are cheaper than traditional display ads.

In its debut June quarter results, the company had shown slowing revenue growth. Analysts and marketers now want the company to monetise its growing use of mobile users.

The company did not give any forward guidance for future quarters nor was there any explanation on how the company planned to tackle the slowing growth. It however had warned that costs and expenses would rise.

Investors seem to have lost faith in the stock in the face of this uncertainty.

Wall Street analysts, who had betted heavily on the future of the company have forecast expenses to rise by a minimum 60 percent over the next two quarters but are unsure if the company will be able to manage at least 30 percent revenue growth.

How Should Investors Play FB Safely, Find In Our Free Report

Investors and analysts are looking for some specific figures from the social networking site - even if it is about expenses. This could provide some clarity in making their projections.

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