Facebook Shares Dive

More bad news for the social networking giant. Facebook’s shares dropped 11 percent after Barron’s said that the company is overvalued.

According to Barron’s, Facebook’s stock price has plunged 40 percent since it went public last May. This has led to investors asking whether Facebook is a good stock to buy.

The newspaper and website said that Facebook is not a good buy. The value of a Facebook share is just $15. Last night’s trading closed at US$22.86.

Facebook’s initial public offering was at US$38.

Barron’s also said that come October 29, Facebook may have to face another blow when company employees would be allowed to sell their shares. Employees own more than one billion shares, which they can start selling starting Oct. 29 and Nov. 14.

If employees choose to sell their shares, analysts say that company shares may even go lower.

Facebook chief Mark Zuckerberg, however, said that the company would make more money as it is giving more focus on mobile.

In stark contrast, Google’s shares increased about two percent. Shares are now at US$748.90. According to industry observers, the rise is because Google remains to be the world’s dominant search engine. Its operating system Android and video-sharing site YouTube continue to be popular.

Industry observers also have a bright outlook on Google. Just recently, Citigroup said stock prices of Google can even rise significantly in one year.