Today, Facebook hit a new milestone, perhaps one that it won’t be celebrating much: the stock went down past $20 a share. In fact, as this post is being written it’s trading at $19.99.
Because this number is a bit arbitrary, here’s some context for how the mighty sometimes become less mighty: this might make Facebook worth less than $44.6 billion, what Microsoft offered to pay for Yahoo in 2008:
Why do we write “might”? A caveat to point out: as Henry Blodget pointed out earlier today, sites like Google Finance and Yahoo Finance might be getting their shares outstanding wrong. Facebook tells him that the number of shares outstanding as of today are 2.74 billion. If you multiply that by the share price, you get a market cap of $54,772,600,000, not $42.83 billion, as noted above.
According to Blodget’s calculation, we will need to wait until the stock is at $16.28 before it hits Yahoo/Microsoft territory.
That could happen sometime on or after August 16: as the WSJ points out, that is when lock-ups on stock sales by employees begin to expire, and will continue to come up on a rolling basis between then and the end of the year. Between the middle of August and the end of the year, the WSJ points out, more than five times the number of shares currently trading will come onto the market. That could mean an even bigger drop in the stock’s price.
When Facebook first listed on May 18, its shares opened at just over $42.