Should Facebook unfriend Zuckerberg over slumping stock price?
The continuing slide in Facebook’s stock price is fueling speculation that the social network might be better off without co-founder Mark Zuckerberg at the helm.
Facebook shares hit a record low of $19.87 at the close of trading Thursday. The slide continued Friday morning with the stock sinking to $19.06 around 11:30 a.m. ET.
The record lows come as early investors, including Goldman Sachs, became eligible Thursday to sell their shares. That made 271 million shares eligible for trading, though it’s not clear how many have been sold.
The drop in share price is another piece of what has been a troubled initial public offering for the world’s largest social network. A few months ago, industry analysts and investors had expected Facebook’s stock to take off, soaring from its opening price of $38 a share to $50, $60 or more.
However, that hasn’t happened. Instead, the company’s IPO has been hammered, sinking instead of growing.
Talk has turned to whether a seasoned business person could better lead Facebook, while 28-year-old Zuckerberg, with his gray t-shirts and hoodies , could focus on the technology.
“I think so much of stock price is about confidence and perception, and Facebook has shattered a bit of the faith that investors had,” said Andrew Stoltmann, a securities lawyer based in Chicago. “I think there’s a lack of confidence in his ability to run a publicly traded corporation. Coming up with lightening in a bottle like he did is an extraordinary skill, but it’s not the same skill as running a publicly traded company.”
Stoltmann, who said he doubts that we’ve seen the bottom of Facebook’s stock price yet, added that bringing in a new CEO would be a great idea for the company right now.
“Look, Zuckerberg, by all accounts, is a genius,” he added. “But you have to have a grown up or a more experienced chief executive running that company.”
But Zuckerberg still has his backers.
Patrick Moorhead, an analyst with Moor Insights & Strategy, said it’s too early to start talking about replacing Facebook’s CEO.
“He has provided the vision Facebook needed to build [the company up] to these heights and they will need him to continue to guide them,” Moorhead said. “Zuckerberg needs to keep the top spot for right now to give Facebook a chance. Remember, the issues at hand are the repercussions from a flawed IPO, not a flawed company.”
Karsten Weide, an analyst with IDC, said there’s no way she sees Zuckerberg making way for a new business leader at the company he founded.
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