It took about 440 days, but shares in the social network company today finally closed above $38 ($38.05 to be exact) — the price Facebook charged for its stock when it went public in May 2012. After gaining 23 cents on Day One, the IPO became a symbol of Silicon Valley hubris — and investor gullibility — as institutional buyers began to fear that Facebook wouldn’t be able to grow. It was unclear whether the company could squeeze many ads into the small screens on smartphones and tablets where users increasingly accessed the service. The stock closed at its lowest price, $17.73 on September 4, the day after The New York Times’ Andrew Ross Sorkin observed that the $50B in Facebook’s lost market value was more “than Lehman Brothers gave up in the entire year before it filed for bankruptcy.” Facebook remained under a cloud. Rupert Murdoch commemorated the first anniversary of the IPO by tweeting: “Look out Facebook! Hours spent participating per member dropping seriously. First really bad sign as seen by crappy MySpace years ago.” But investor perceptions changed dramatically on July 24 when Facebook beat the Street’s earnings expectations with strong sales of mobile ads. Shares are up 45.6% since then.
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