Facebook has opted to list its shares on the Nasdaq exchange when the company makes its initial public offering in the coming weeks, according to several media sources. The report appears to have originated with a tweet from CNBC on Thursday and was later corroborated by other outlets, including Bloomberg, the New York Times, and The Wall Street Journal.
Facebook has not confirmed any details about its IPO plans beyond the S-1 form and addenda it has filed with the Securities and Exchange Commission.
In February, Facebook filed for a $5 billion IPO, ending months of speculation that the social networking giant was planning to go public. The company hasn't named a date for its IPO, saying only that it would commence the sale of stock to the public "as soon as practicable," but the latest rumors point to a May date.
Facebook will trade under the ticker symbol "FB" on the Nasdaq, according to reports. The choice of the exchange that's home to such tech giants as Apple and Google wouldn't be much of a surprise to Facebook watchers, though the rival NYSE did recently win the listings of LinkedIn and Pandora, a pair of so-called Web 2.0 companies like Facebook that went public in 2011.
Zynga, the social game developer that is Facebook's biggest single business partner in terms of driving revenue, also opted to list on the Nasdaq when it went public last December. Groupon, another Facebook peer, is also listed on the Nasdaq.
Facebook's IPO could be the largest ever, according to some analysts, and the company appears on track to achieve a paper valuation north of $100 billion.
Facebook's S-1 filing was a "brilliant move," according to Tim Loughran, a finance professor at Notre Dame who has also analyzed the initial offerings of Zynga, Groupon, LinkedIn, and other social media companies. Loughran thinks the company's IPO valuation of "only $5 billion" should make Facebook "a very hot IPO in terms of first-day returns ... $5 billion is not much to spread around to both retail and institutional investors (regardless of the offering price)."
Loughran also expects that a scarcity of shares will raise Facebook's market value in the short-term and propel the company to conduct a follow-on offering later, which could attract "institutional players to take more meaningful positions in Facebook."
The company's IPO is also expected to create a handful of newly minted billionaires, starting with Facebook founder Mark Zuckerberg, and potentially 1,000 or more new millionaires among employees holding stock options. That could create an influx of buyers in already tight Bay Area real estate markets, particularly in San Francisco, one of the priciest housing markets in the country.
For more from Damon, follow him on Twitter @dpoeter.
