- Egypt rights center raided, 2 Mubaraks acquitted
- New Mexico Supreme Court rules same-sex marriage constitutional
- Blame Bush: 5 years later, that’s still the mantra, pollsters find
- Dutch prostitutes demand same retirement benefits as soccer stars
- John McCain to Harry Reid: I’ll ‘kick the crap’ out of you
- Dogs that talk: Researchers seek $10K for ‘No More Woof’ technology
- 1,000 firefighters called to battle stubborn Big Sur wildfire
- Black Friday brouhaha: Millions of Target shoppers hit by credit card theft
- Britain orders airplane to rescue citizens from violent South Sudan
- Mega Millions winner emerges as Georgia mom, in ‘disbelief’
Zynga stock lukewarm in public debut
Question of the Day
NEW YORK (AP) - Zynga's stock got a lukewarm reception in the opening minutes of its public debut Friday.
Right after it began trading Friday, the online game developer's stock gained a few pennies over the $10 per share it priced at Thursday night. It then fell below that opening price. It wasn't the eye-popping jump that's been the norm for freshly public Internet darlings such as Groupon Inc. and LinkedIn Corp.
Zynga Inc., which specializes in Facebook games, raised $1 billion in its initial public offering of stock. That makes it the largest Internet-related IPO since Google Inc. went public in 2004, raising $1.4 billion. CEO Mark Pincus rang the Nasdaq's opening bell in San Francisco.
The price was at the top of its expected range, a sign that investors were eager to dig into the latest in a series of high-profile technology IPOs this year. It values the company at about $7 billion.
Online deals site Groupon, which began trading in early November, has a market capitalization twice that of Zynga's, $14 billion. But Zynga is selling a much bigger chunk of its available shares, 14.3 percent compared with Groupon's 5.5 percent. It's an issue of supply and demand _ selling more shares means investors don't have to scramble to get their hands on them.
Zynga rounds out a year of high-profile Internet IPOs. The biggest of them all, though _ Facebook _ is not expected until after April.
Zynga charges small amounts of money _ a few cents, sometimes a couple of dollars _ for virtual items in online games. The games are free to play. Players can acquire items that range from crops in "Farmville" to buildings in "CityVille," its most popular Facebook game.
With its huge player base and a few loyal spenders, Zynga earned a net income of $90.6 million in 2010, an unusual pre-IPO money-maker in the sector.
Cowen & Co. analyst Doug Creutz, however, initiated coverage Friday with a "Neutral" rating on the stock. Although Zynga is the leader in Facebook gaming, he's concerned that it won't be able to grow fast enough to justify its stock price. Growth in Facebook gaming has slowed, and Zynga's market share has declined from 50 percent to 38 percent of daily active users, he wrote.
He's also concerned that Zynga's famously aggressive and hard-charging culture may not be the best field to grow good games in. Others have raised concerns that the focus on deadlines and profits might be squeezing out creativity and talent.
In November, online coupon company Groupon raised $700 million in its IPO. The granddaddy of all Internet IPOs might happen next year, as Facebook Inc. is expected to raise as much as $10 billion.
Zynga is trading under the ticker "ZNGA" on the Nasdaq Stock Market.
AP Technology Writer Peter Svensson contributed to this report.
By Michael P. Orsi
Edward Snowden should declare his patriotism in court
- Citing 'unfair system,' Obama commutes sentences for 8 crack offenders
- Homeland Security helps smuggle illegal immigrant children into the U.S.
- Gov't wasted $30 billion on 'pillownauts,' crystal goblets -- buying human urine!
- Bill Gates: The Secret Santa disguised as a 'friendly fellow' on Reddit
- Obamacare 'pajamas boy' gets roundly mocked
- Armed response, not restrictive gun laws, brought swift end to school shooting
- U.S. pilot scares off Iranians with 'Top Gun'-worthy stunt: 'You really ought to go home'
- U.S. Army mulls wiping out memory of Robert E. Lee, 'Stonewall' Jackson
- Sebelius adds another Obamacare exemption
- BOLTON: Nero in the White House
Independent voices from the The Washington Times Communities
Southern Fried Politics from the Lens of a Persian-American Millennial
All of the world’s problems, solved on your back porch
Top 10 handguns in the U.S.
Extraordinary day at Redskins Park
White House pets gone wild!
Let it snow