The social network company’s shares are down 1.7% at midday to about $17.74, and at one point touched $17.58 — a new personal worst for the stock that sold for $38 when the company went public in May. The drop comes as many Wall Street investors debate a scathing New York Times column by Andrew Ross Sorkin this morning that fingers CFO David Ebersman as the exec who was “more responsible than any other for the staggering mispricing” of the IPO, which resulted in a $50B decline in Facebook’s market value over the last three months. “To put that in perspective, that’s more market value than Lehman Brothers gave up in the entire year before it filed for bankruptcy” in 2008, Sorkin writes. He adds that in addition to the misery that’s created on Wall Street, it is “quickly creating real questions inside the company about its ability to retain and attract talented engineers, the lifeblood of any technology company.” Ebersman also infuriated major investors when he recently visited New York to address their concerns. Several invitations for Friday meetings “were oddly, and somewhat imperiously” sent out the night before. “Given that it was summer, some investors sent their junior analysts,” Sorkin says.
But entrepreneur Mark Cuban says in the Huffington Post that Sorkin’s case against the CFO is “180 degrees wrong.” If Ebersman appeared on ABC’s SharkTank and said “he was able to sell his shares to the public for $38 a share, but turned down the opportunity, I would crush him for being an idiot….As far as traders who bought the stock hoping for a pop. No one cares about them. Seriously. You trade, you know you are going to lose on trades. That is how things work.”
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