Investors brace for Facebook debut on Wall Street

A monitor shows a welcoming message for Facebook's listing on the NASDAQ Marketsite prior to the opening bell in New York.

Investors are bracing for Facebook’s Wall Street debut on Friday after the world’s No.1 online social network raised about $16 billion in one of the biggest initial public offerings in U.S. history.

Valued at $104 billion, Facebook is larger than Starbucks Corp and Hewlett-Packard combined, sparking intense speculation on how much higher its valuation will rise once shares start trading.

“A 15 to 20 percent pop is in the realm of possibility,” said Tim Loughran, a finance professor at the University of Notre Dame. “Given they already moved their IPO range up and increased the size, that’s bullish to begin with.”

Facebook priced its offering at $38 a share on Thursday, but the price could be higher when shares begin trading under the FB symbol on the Nasdaq at around 11 a.m. Eastern Time.

Some expect shares could rise 30 percent or more on Friday, despite ongoing concerns about Facebook’s long-term money-making potential. An average of Morningstar analyst estimates puts the closing price for Facebook shares tomorrow at $50.

The IPO, expected to mint more than a thousand paper millionaires at the company, has received wall-to-wall media coverage and sparked hopes of a boom in sales of everything from San Francisco Bay Area real estate to automobiles.

Facebook employees marked the event with an all-night “hackathon” at the company’s Menlo Park, California headquarters starting on Thursday evening, a tradition in which programmers work on side projects that sometimes turn into mainstream offerings.

Facebook’s 28-year-old founder and Chief Executive Mark Zuckerberg was expected to ring a bell at the company’s Silicon Valley headquarters on Friday morning to kick off trading on the Nasdaq.

Founded in a Harvard dorm room in 2004, Facebook has grown into the world’s dominant social network with 900 million users.

At $38 a share, Facebook would trade at over 100 times historical earnings versus Apple Inc’s 14 times and Google Inc’s 19 times.

For all the high expectations surrounding Facebook, the company faces challenges maintaining its growth momentum.

Some investors worry the company has not yet figured out a way to make money from the growing number of users who access Facebook on mobile devices such as tablets and smartphones. Meanwhile, revenue growth from Facebook’s online advertising business, which accounts for the bulk of its revenue, has slowed in recent months.

“With mobile usage growth exceeding desktop, monetization in the near term could be reduced given little-to-no ad coverage on mobile, challenged by limited screen sizes,” said a report last week from Susquehanna Financial Group.

GM said on Tuesday it would stop placing ads on Facebook, raising questions about whether display ads on the site are as effective as traditional media.



News
Entertainment
Sports
Lifestyle
Local

NYPD looking for man they say assaulted elderly…

      The New York City Police Department is asking for the public's assistance in locating a Hispanic male 20's wanted in connection with…

Local

Three arrested after allegedly assaulting off-duty officer in…

Three men were arrested early Saturday morning after allegedly assaulting an off-duty officer at a Bronx bodega, and the NYPD is asking for the public's…

Local

Healthcare union creates vibrant West Indian Day Parade…

Volunteers worked almost around the clock through the weekend, putting the flashy finishing touches on hundreds of costume pieces 1199SEIU members will wear while marching…

National

Top 10 most hipster college campuses

Hipsters are everywhere these days. You can't walk down the anywhere anymore without seeing a pair of skinny jeans on a handlebar mustachioed 20-something, a…

Arts

Theater: Discouraging 'Poor Behavior'

Theresa Rebeck's latest off-Broadway play, about two couples sparring on a weekend getaway, repeats a few mistakes of her past.

Gossip

Chef Todd English arrested for DWI in the…

Celebrity chef Todd English is facing DWI charges after a traffic stop on Sunday.

Movies

Box office: 'Guardians of the Galaxy' is 2014's…

This weekend "The Guardians of the Galaxy" passed the fourth "Transformers" movie to become the highest grossing film of 2014.

Gossip

Spears back with controversial ex?

Is Briteny Spears back with Adnan Ghalib?

Sports

Novak Djokovic feeds off US Open crowd to…

Novak Djokovic isn't a native New Yorker, but he sure knows how to use the U.S. Open crowd to his advantage.

NFL

Odell Beckham still 'weeks away,' Tom Coughlin angry…

Giants head coach Tom Coughlin has fought a losing battle against the media all preseason over the status of wide receiver Odell Beckham Jr.

NFL

3 things we learned in the Giants preseason…

The final score didn’t matter — a 16-13 win by the Giants — but it would’ve been nice to finally see Big Blue’s new-look offense get on track.

NFL

NFL Power Rankings: Seahawks, Broncos, Patriots, 49ers start…

NFL Power Rankings: Seahawks, Broncos, Patriots start at top

Education

These college students think breakfast is the most…

  It should be no surprise that the city that never sleeps is also home to the most students who like to order food in…

Sex

When it comes to dating, height matters

Does a man’s height really matter when it comes to dating? Unfortunately - according to a new study - the answer looks like it’s yes.…

Travel

10 free apps to make traveling easier

Finding the nearest bathroom, calculating currency exchanges and locating your departure gate must have been difficult for travelers of previous generations. But we wouldn't know,…

Travel

How to get a seat upgrade to business…

It used to be much easier to upgrade your coach seat to business or even first class, but rigid rules and tighter schedules have made…