The Biggest Pump And Dump Ever?

Facebook: The Biggest Pump and Dump Ever? The largest internet IPO ever, and third largest in U.S. history, Facebook was set to make market history with its mid-May public offering. But with all the hype surrounding its launch, and with investors scrambling to claim shares, few analysts paid attention to the underwriters manipulating share value behind the scenes, resulting in a massive market flop. See the series of events leading up to Facebook's massive IPO, and the fallout that swiftly followed its lackluster performance. 2009 IPO DAY STOCK MAY 26: Digital Sky Technologies invests $200 million Facebook 82 MILLION SHARES TRADED IN THE FIRST 30 SECONDS valued at $10 billion OPEN: $42.05 O = SI BILLION 0000000000 HOVERED BETWEEN $45 AND $38 DURING TRADING CLOSE: $38.23 AUGUST IO: Acquires FriendFeed 566 MILLION SHARES TRADED -- A NEW RECORD 2010 PROMPT TURN FOR THE WORST FEBRUARY 19: Acquires Octazen THE DEVALUATION OF FACEBOOK'S SHARE VALUE APRIL 2: Acquires Divvyshot Just over 3 months after the deal, Facebook was valued at $52 billion, down from the $104 billion valuation on the day of the IPO. MAY 18: 38 May 18 $38.23 1.6% Enters 5-year contract May 21 $34.03 + 10% 36 with Zynga May 22 $31 + 18% 34 May 30 $28.19 + 26% MAY 26 : Jun 5 $25.87 + 32% Acquires ShareGrove Jun 15 $30.01 21% JUNE 29: $33.05 + 14% Jun 22 Elevation Partners purchase Jul 16 $28.25 + 26% $120 million in stock Facebook Jul 27 $23.71 +38% valued at $23 billion Jul 31 $21.71 43% O = SI BILLION Aug 1 $20.88 +45% 22 Aug 2 $20.04 +47% 20 Aug 17 $19.05 50% Sept 4 $17.73 + 53% MAY JUNE JULY AUGUST Sept 6 $18.98 +50% 2012 2012 2012 2012 JULY 8: THE CONTROVERSY Acquires Nextstop AUGUST 23: Acquires Hot Potato FACEBOOK'S IPO RAISED CONCERNS THAT SMALL OCTOBER 29: INVESTORS ARE PUNISHED BY THE EXISTING SYSTEM Acquires Drop.io 2011 THE BIG PLAYERS, INVESTMENT BANKS, INVESTMENT BANK JANUARY 21: Goldman Sachs and Digital Sky Technologies invest $1.5 billion in Facebook HAVE THE POWER TO CONTROL MARKET PRICES Facebook valued at $50 billion - SI BILLION THAT'S 11% MORE Chief underwriter 26% Morgan Stanley gave investors 26% of its shares than the standard 15% JANUARY 25: Acquires Rel8tion Underwriters Morgan Stanley (38% of IPO shares), Goldman Sachs (15% of IPO shares) MARCH I: 38% and JP Morgan (20% of IPO shares) all cut Acquires Snaptu and Beluga Facebook's earnings estimates during the IPO APRIL 27: roadshow - a rare, almost unheard-of move 20% 15% Acquires Dayturn CONCURRENTLY: JUNE 9: Acquires Sofa THE DEAL KEY JULY 6: Facebook partners with Skype, developing video chat THE DEAL'S EXPANDED, SHAREHOLDERS PRICE RANGE MAKING MORE INCREASED INCREASED SHARES THEIR SALES OF AVAILABLE SHARES AUGUST 2: Acquires Pop Press SEPTEMBER 22 : In response, Rep. Darrell Issa (R-California) composed a letter to the Securities and Exchange Commission regarding pricing/ Facebook's Timeline is launched disclosure in IPOS: OCTOBER I0: THE SEC Acquires Friend.ly CITED FACEBOOK'S SWIFT INVESTIGATED NOVEMBER 16: SHARE DECLINE FOLLOWING IPO, POSSIBLE RULE Acquires MailRank CLAIMING THAT INVESTMENT VIOLATION: The underwriters shared DECEMBER 2: BANKS PAY LITTLE ATTENTION research analyst warnings Acquires Gowalla about Facebook with TO THE MARKET REGARDING 2012 preferred clients, but not the public SUPPLY AND DEMAND 1 in 8 people are Facebook users LOOKING TO THE FUTURE: FEBRUARY I: MANY ECONOMISTS ARE QUESTIONING THE Facebook files for IPO CURRENT IPO MODEL APRIL 9: FACEBOOK'S MASSIVE FAILURE COULD Acquires Instagram APRIL 13: PAVE THE WAY FOR IPO REFORM Acquires Tagtile MAY 5: SOURCES: Acquires Glancee http://www.cnbc.com/id/48945646 http://www.webpronews.com/facebook-ipo-timeline-of-acquisitions-2012-05 http://www.thedailybeast.com/articles/2012/05/18/facebook-ipo-by-the-numbers-zuckerberg-s-loot-more.html https://www.google.com/finance http://online: http://www.businessinsider.com/exclusive-heres-the-inside-story-of-what-happened-on-the-facebook-ipo-2012-5 MAY 15: .wsj.com/article/SB10001424052702304441404577479024205961592.html Acquires Lightbox http://mashable.com/2012/05/16/facebook-ipo-timeline/ http://news.cnet.com/8301-1023 3-57457674-93/lawmakers-push-sec-for-new-ipo-regulations-after-facebook-gaffe/ http://news.cnet.com/8301-1023 3-57450575-93/how-nasdags-ceo-missed-facebooks-ipo-meltdown/ http://news.cnet.com/8301-1023_3-57433719-93/everything-you-need-to-know-about-the-facebook-ipo-fag/ http://www.cbsnews.com/8301-505245_162-57501236/prices-of-facebook-stock-since-long-awaited-ipo/ MAY 18: IPO launches at $38 per share - Zuckerberg's wealth skyrockets to $20.3 Billion http://money.cnn.com/2012/05/18/technology/facebook-ipo-trading/index.htm http://techcrunch.com/2012/05/18/charts-facebooks-ipo-in-historical-context-and-its-share-price-over-time/ http://www.forbes.com/sites/tomiogeron/2012/05/17/facebook-prices-ipo-at-38-per-share/ Facebook's IPO pump and dump is not uncommon... profit from it next time www.timothysykes.com Price per Share