The Associated Press May 31, 2012, 2:13PM ET

Facebook's stock continues decline after rocky IPO

Facebook's stock is once again declining after its huge but rocky initial public offering.

Shares of Facebook Inc. dropped 96 cents, or 3.4 percent, to $27.24 in midday trading Thursday. The stock is down more than 28 percent from its IPO price.

Facebook began trading on the Nasdaq Stock Market on May 18. The day started with a delay due to trading market glitches and didn't get much better from there.

The company, along with the investment banks that led the IPO, is also the subject of at least two shareholder lawsuits. They allege that analysts at the large underwriting investment banks cut their financial forecasts for Facebook just before the IPO and told only a handful of clients. Morgan Stanley has declined to comment. Facebook calls the lawsuits "without merit."

Standard & Poor's equity analyst Scott Kessler, who has a "Sell" rating on Facebook's stock, lowered his target price to $27 from $30 on Thursday. He also lowered his earnings forecast to 39 cents from 40 cents for 2012.

May has been a bad month for the broader stock market too. On Thursday, the Dow Jones industrial average fell 89.1 points to 12,330.78 amid worries about the European economy.


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