Zynga stock falters, holds on first day of trading [Joystiq]

[DP ServBot]

Zynga stock finally roared out of the gate and on to the trading floor yesterday at $10 a share, but investors weren't hugely impressed with the social gaming company. The stock started up a dollar at $11, and then dropped back down two, and then thirty, and then fifty cents during the day, leveling off at $9.50, which Forbes says was thanks mostly to "a stabilizing bid by Zynga's underwriters," which means Zynga's investors stepped in and bought up enough stock to keep the price up.

So what happened? Shortly put, Zynga's stock wasn't really worth what it was priced out at. An initial public offering is designed to be priced a little low, in order to drum up demand for a company's stock from the public (not to mention raise some money). But Zynga went high and, as a result, didn't quite get the graph it wanted today.

They didn't sell the FarmVille, so to speak -- ZNGA will likely be trading fine on Monday (and $9.50 is fine for the highly competitive gaming industry; THQ is sitting down at 75 cents right now). But Zynga's hype phase appears to be over. Now the company needs to prove it can sell more than just cow clickers.Zynga stock falters, holds on first day of trading originally appeared on Joystiq on Sat, 17 Dec 2011 07:00:00 EST. Please see our terms for use of feeds.




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[Graham Mitchell]

I'm not a fan of Zynga by any means, but if this continues to drop it might not be a bad deal to pick it up cheap. After the holidays lots of people will be playing Mafia Wars on their new ipads.

However, $10 a share is fucking ridiculous for the first day on the market.

[Ryudo]

I hope them and Rovio die a horrible death. Working for those kind of companies is the most cutthroat in the industry and managed by loan sharks.