New York: Facebook topped 100 million shares traded in the first four minutes after its debut on the Nasdaq. By comparison, Amazon.com has traded about 2.2 million shares today and Google about 2 million.
Seven minutes after its first trade, the stock was hovering at about $40, a $2 gain over its offering price.
It's Facebook's big day. The site, which was born in a dorm room eight years ago and has grown into a worldwide network of almost a billion people and has made the most talked-about stock market debut in years.
More than 80 million shares have traded in the first minute at the Nasdaq. The stock opened with a jump of about 11 percent, at $42.05, or $4.05 higher than the listing price.
The Wall Street Journal reported that traders experienced problems changing and canceling their orders for Facebook stock ahead of the debut. There was no immediate comment from Nasdaq.
Alper Aydinoglu, a student at DePaul Unviersity in Chicago, said that he got 50 shares via an Etrade account that he opened specifically to buy Facebook shares.
"It's my first IPO experience," Aydinoglu said.
He added: "I bought the stock for a couple of reasons. No. 1, there's so much hype about Facebook and everybody is going to be getting in on it, so there will likely be a huge pop in the stock today. Another reason is that Facebook is a great company. Mark Zuckerberg created something huge."
He said that if the stock rises 15 percent to 50 percent, he may sell half and keep the rest. If the stock drops, he said, he plans to get out altogether.
Meanwhile a German data protection official has warned Facebook investors that the site's $38 starting share price is based on practices that may breach European privacy rules.
Thilo Weichert, data protection commissioner for the northern German state of Schleswig-Holstein, said shareholders should be aware that if European privacy authorities have their way, "Facebook's business model will implode."
Weichert was quoted by German daily Frankfurter Allgemeine Zeitung on Friday saying Facebook could be ordered to stop transferring user information to the United States.
Facebook's IPO prospectus warns investors that its business is subject to "complex and evolving U.S. and foreign laws and regulations regarding privacy, data protection, and other matters" that could harm its business.
The banks helping take Facebook public want us to value this 8-year-old upstart at as much as $104 billion, more than Disney or Kraft Foods, though those companies earn three and four times more. That top valuation is also more than 100 times Facebook's earnings last year, versus 13 times for the average company.
At such a high price, it will take years for this so-called earnings multiple to fall to a more reasonable level, and that's assuming the company can maintain its torrid earnings growth.
To make money in Facebook, you're betting that other buyers will be just as willing as you to hold their nose at the valuation, and keep doing so for years.
Facebook grew its earnings 65 percent last year, faster than at most companies, so you should pay more for it than you would the typical company. But how much more? Profits at Apple grew 85 percent last year. Its stock is trading at 13 times earnings per share.
(With inputs from Associated Press)
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