Shares of Facebook traded around $38 Wednesday, marking the first time the company’s shares have reached that level since its IPO in May 2012.
The long-awaited rise in share prices is a relief to shareholders, who expected big things when the social-media company went public, only to experience a drastic initial drop and shares trading as low as $17.73 in early September.
“It only made sense that if they did the right thing, they would get paid,” Chris Baggini, a senior portfolio manager at Turner Investments, told The Wall Street Journal. Turner has held most of its two million Facebook shares since the IPO.
The share-price hike comes after Facebook released promising second-quarter results on July 24, which showed the company growing mobile advertising revenue by 76 per cent over the previous quarter. The increase in ad sales was taken as a sign that Facebook is adapting its business strategy to mobile technology, as users increasingly view the social-media service on smartphones.
Facebook’s initial IPO back in May 2012, was considered to be somewhat bungled. Trading of Facebook shares was delayed due to technical problems and the stock fell more than 20 per cent within its first two weeks on the NASDAQ.