Facebook shares surge back to IPO levels

If you were buying Facebook shares during the panicked selling spree that followed its less than perfect IPO, you may have been onto something. Over the last few hours, the big blue social network’s stock price has surged to just under US$38, the same price it was when the company went public.

In fact, reports USA Today, the stock managed to get to US$37.63, four cents outside its opening price.

In order to get there, it rose US$2.20 or six percent on the day, continuing a pattern of recovery from the US$18 it hit in early September 2012. That’s not only good news for the people who bought when it was that low, but also validation for the investors who bought in at US$38 a share.

The sudden surge in the stock price has been aided by a pretty solid set of Q2 financial results in which it announced that its 819-million mobile users contributed 41% of its US$1.60-billion in ad revenue.

While the stock price eventually fell again to US$36.80, both the company and its investors will be hoping it can carry on the general trend of positivity and break through that magical US$38 opening day mark, something it hasn’t achieved since the early flurry of excitement that followed the IPO. At that point its stock managed to climb as high as US$45.

“It is a psychological barrier more than anything, as the company’s fall from grace after the IPO has remained a sore spot for investors and employees,” Colin Sebastian, analyst at RW Baird told USA Today. “For the executive team, it represents some validation by the market that the company’s mobile pivot and technology-driven platform improvements are finally paying off. After all, advertisers can’t ignore more than a billion users forever.”

While some early investors might be itching to sell while the going’s good and get as close to breaking even as possible, more than a few will be playing the long game to see if things keep going well.