By Matt Krantz and Gary Strauss, USA TODAY
Facebook jumped 13% to $43 as the stock opened for trading for the first time Friday morning. But almost as quickly, the early gains evaporated and shares in the world's largest social networking company were barely trading above their $38 initial offering price.
The stock was sold to select investors at the IPO price of $38 a share. There were so many last-minute orders clogging the Nasdaq exchange that trading, initially set for 11 a.m. ET, was delayed nearly 30 minutes Friday. More than 200 million shares traded within the first hour.
Still, after the early price pop, investor enthusiasm began to wane. At noon, the shares were trading at about $39.90 - up about 5%.
Born in a Harvard University dorm room in 2004, Facebook has become part of the social fabric of more than 900 million users. With a market value of more than $104 billion, Facebook is worth more than Amazon.com, McDonald's, Cisco Systems and Visa.
The company raised $16 billion in the IPO. It could raise more, up to a total of $18.4 billion, if the company's investment bankers utilize an overallotment option reserved to satisfy additional demand.
Earlier this week, the initial share price and the number of shares being sold was increased because of high investor demand for stock in the social-networking giant.
Before trading began, people huddled outside the windows of the Nasdaq site in New York's Times Square, waiting for the stock to open. Some held up cell phones and cameras pointed at the Nasdaq board, waiting to get a picture of the first price change.
The rich valuation for the company comes as it tries to cement its role in the Internet, as contributions by users and their interactions with each other become more important.
Facebook has taken the lead by grabbing hundreds of millions of users, but still has much to prove in finding ways to boost the profit it earns from those users.
Contributing: Associated Press