Zynga hits Wall Street – then stumbles
Social game maker Zynga's much anticipated debut on Wall St. didn't go quite as well as planned Friday.
The company finished the trading day at 9.50, 5 percent below its offering price – as investors, fearful of a new tech bubble, steered clear and analysts ripped the company on growth concerns.
Before shares even began trading, one of the gaming industry's more notable analysts – Sterne Agee's Arvind Bhatia – initiated coverage with an "sell" rating, citing the notable slowdown in the company's growth in recent months. And Cowen and Company's Doug Creutz gave the company a "neutral" rating in coverage today.
It's an ugly debut for the company, but not one that will negatively impact it. Founder Mark Pincus holds 70 times more voting power than all of the common stock that went up for sale today, so the performance of the stock has no impact on him (or the rest of Zynga, really). If the company tanks and investors call for his head, he can ignore them. If it soars to Google or Apple territory, he profits.
It's a true win-win – unless you're an investor.
Chris Morris reports on the the intersection of Hollywood and technology, as well as the latest must-have consumer technology gadgets.
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