MENLO PARK, Calif., June 4 (UPI) -- Facebook investors filed suit against Chief Executive Officer Mark Zuckerberg, saying he knew the firm's initial share price was too high, court papers say.
TMZ reported Monday the class-action lawsuit claims Zuckerberg sold a significant share of his Facebook stock, knowing in advance the $38 per share price would not hold up.
The price of Facebook shares has dropped sharply -- off nearly 30 percent, trading at $27.27 per share late Monday -- since its public debut May 18.
This is the second lawsuit filed concerning Facebook and underwriters withholding information before the firm's IPO, which was also marred by technical difficulties at the Nasdaq stock exchange.
The new lawsuit claims underwriters of the IPO -- Morgan Stanley, JPMorgan and Goldman Sachs -- notified large investors the stock was overvalued, but did not disclose this to smaller investors, known as retail investors.
MarketWatch reported Monday market analyst Carlos Kirjner of Bernstein Research set a price target for the company at $25 per share.
"It is difficult to argue for owning stock today," Kirjner wrote in a research note.
Kirjner said the company's revenue capacity through display ad inventory, projected revenue growth and the value of future business opportunities put Facebook in a "material risk," category.
"Investors will question Facebook's ability to achieve our ... (projected) 2013 revenue as near-term (sales) growth decelerates," Kirjner said.
The analyst also said the value of social advertising is uncertain and "will not be resolved in the next 12 months."
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ANGKOR WAT, Cambodia, June 18 (UPI) --Aircraft equipped with lasers have revealed a lost city near Angkor Wat in Cambodia, hidden for centuries under a dense forest cover, researchers say.