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Facebook to be sued over shares

Facebook and banks including Morgan Stanley are being sued by shareholders who claim the defendants hid Facebook's weakened growth forecasts when shares went on sale for the first time last Friday.

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Facebook shares close down nearly 9% on third day of trading

A TV correspondent reports on Facebook's tumbling share price from inside the Nasdaq MarketSite in New York's Times Square. Credit: AP Photo/Richard Drew

Facebook's share price closed down $3.03 or 8.9% at $31 in New York today.

In its three days of trading, Facebook's stock has dropped 18.4% from its $38 issue price.

For the thousands of investors that bought at the IPO, that's bad enough, but one analysis of its earnings prospects suggests it could get a lot worse - more like $10 a share.

Setting aside the hype and the cultural phenomenon that is the online networking site, Facebook Inc would be fairly priced at $9.59, according to the smattering of Wall Street estimates analyzed and modeled by Thomson Reuters StarMine.

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