Sometimes, when a love affair ends, you can't remember what it was you ever saw in someone in the first place. That is the feeling right now of a lot of once-amorous investors who breathlessly wooed Facebook at its flotation in May and paid $38 for the privilege of a share in the social network. It is the feeling right now of Pandora Media investors, who paid $16 per share for a stake in the online radio business. It is the feeling, too, of investors in Zynga, who got shares in the online games maker at $10 a pop.
Compare their share prices as of start of trading yesterday: $20.04 for Facebook, a loss of 47 per cent; Pandora at $9.25, down 43 per cent; Zynga at $2.70, a 73 per cent wipe-out.
Fair to say, Wall Street has fallen out of love with these internet stocks, and badly. They have poisoned the prospects for others, like Twitter or Foursquare, who were waiting in the wings for their stock market debut. If excitement over the arrival of these social media companies last year threatened to bring on a new dot com bubble, it shows serious signs of popping.
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