Anxiety Appears to Build on Wall Street Over Facebook Stock


Wall Street appears somewhat anxious about Facebook’s stock – a week before the company reports its quarterly results.

On Monday, the stock dropped over eight percent and was down over two percent on Tuesday morning. Monday’s results were the biggest one-day drop for the company since May 29, according to news reports.

Facebook fell 17 percent from the high in June and dropped some 27 percent from the IPO price of $38. The IPO was a source of disappointment for the company.

One analyst, Laura Martin of Needham & Co., suggests that some shareholders are trying to get rid of shares before the earnings report next week. She speculates there could be “weaker” earnings. There could be news of slower growth, too.

The company's quarterly results will be released after markets close on July 26.

As it now stands, Facebook is expected to report $1.16 billion in sales during the second quarter, according to average estimates from analysts. The average dropped 3.9 percent in just four weeks.

In other news, Capstone Investments' Rory Maher reports the number of U.S. Facebook users dropped some 1.1 percent over the last six months. The number of UK users basically stayed the same and the number of users in Japan and India jumped over 60 percent and 20 percent percent, respectively, according to Street Insider.

Also, on Wednesday Facebook could face some more unpleasantness with the U.S. Senate Judiciary Committee holding a hearing about the company acquiring Israeli face-recognition company There could be questions presented about privacy and concerns how the technology will be used. In June, Facebook acquired for $60 million. One of the skeptics about the deal and Facebook’s use of the technology has been U.S. Senator Al Franken (D-Minn.), who notes how Facebook has access to content from 900 million users.

“A back of the envelope calculation suggests that Facebook could easily have a face print for one out of every 20 people on the planet," Franken said in a recent statement to the Federal Trade Commission."The key is to ensure that strong safeguards exist for privacy and civil liberties so that the benefits of these biometric technologies aren't outweighed by negative effects on privacy."

In other company news, Facebook CEO Mark Zuckerberg is apparently trying to find a way for his company to take advantage of the public’s increased use of mobile devices.

Edited by Brooke Neuman

TechZone360 Contributor

Related Articles

Coding and Invention Made Fun

By: Special Guest    10/12/2018

SAM is a series of kits that integrates hardware and software with the Internet. Combining wireless building blocks composed of sensors and actors con…

Read More

Facebook Marketplace Now Leverages AI

By: Paula Bernier    10/3/2018

Artificial intelligence is changing the way businesses interact with customers. Facebook's announcement this week is just another example of how this …

Read More

Oct. 17 Webinar to Address Apache Spark Benefits, Tools

By: Paula Bernier    10/2/2018

In the upcoming webinar "Apache Spark: The New Enterprise Backbone for ETL, Batch and Real-time Streaming," industry experts will offer details on clo…

Read More

It's Black and White: Cybercriminals Are Spending 10x More Than Enterprises to Control, Disrupt and Steal

By: Cynthia S. Artin    9/26/2018

In a stunning new report by Carbon Black, "Hacking, Escalating Attacks and The Role of Threat Hunting" the company revealed that 92% of UK companies s…

Read More

6 Challenges of 5G, and the 9 Pillars of Assurance Strategy

By: Special Guest    9/17/2018

To make 5G possible, everything will change. The 5G network will involve new antennas and chipsets, new architectures, new KPIs, new vendors, cloud di…

Read More