Facebook Stock Hits All Time Low, Rebounds Slightly
BOSTON (CBS) - Facebook recovered a little bit Monday, closing at $20.01, up 96 cents. Even so, the stock has lost about half its value since its initial public offering three months ago.
David Smith, Chief Investment Officer at Rockland Trust Investment Group in Hanvover, says he's a little nervous about Facebook's business model.
WBZ NewsRadio 1030's Rod Fritz reports
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He notes that many people use Facebook on their phone, and screens aren't big enough for advertisements to have any serious impact. Because of that, advertisers aren't willing to spend money on the same number of "looks" as they were when Facebook was mainly a computer platform.
Turning to Groupon, Smith says he sees no future in that stock. It closed Monday at $4.64 a share, down 11 cents. Smith says in many respects, it feels like the 1990's.
He says many companies like Groupon are putting out IPO offering documents that show them not making much money, yet the valuations are incredibly high.
Smith says investors are getting rational, like they did in the early 2000's, and values are correcting themselves.
