After hitting a new low Tuesday as shares tumbled 6% to $21.71, the drop continued Wednesday. The stock (FB) was down more than 3% to $21.01 at one point.
Four trading sessions after the social-networking giant reported earnings for the first time as a public company, concerns about growth and share valuation are far from over.
The shares are now almost 45% below the $38 a share IPO price when it started trading May 18.
While the company’s results last week roughly matched Wall Street expectations, investors had hoped to see more progress in terms of user growth and in how the company is capitalizing on the rapid rise of mobile usage. Investors wanted Facebook (FB) to "show confidence they could grow the company, and they didn’t," says Francis Gaskins of IPODesktop.com
The worst may be yet to come. On Aug. 16, 91 days after the IPO, insiders, such as company officers, directors and employees, can sell 268 million shares of stock. Between 91 and 181 days after the IPO, insiders can sell an additional 137 million shares. Given the stock’s plunge so far, investors are braced for an avalanche of available shares from insider sales, putting more downward pressure on the stock price.