With Facebook’s shares hitting near the $30 mark on Tuesday morning, it is worth looking at how the social network’s valuation compares to others of its Internet and tech peers – given that the stock has now lost more than 20% from its IPO value in just over a week’s time. 
 
 Facebook’s /quotes/zigman/9962609 /quotes/nls/fb FB valuation is still generous compared to most of the group. At $30 per share, Facebook trades about 55 times estimated earnings for the current fiscal year. That’s a huge premium over Google Inc. /quotes/zigman/93888 /quotes/nls/goog GOOG – it’s closest competitor – which currently trades a little less than 14 times estimated earnings for the same period. And many other well-regarded, large tech firms have price-to-earnings ratios in the mid-to-low teens, including Apple /quotes/zigman/68270 /quotes/nls/aapl AAPL , IBM /quotes/zigman/230066 /quotes/nls/ibm IBM , Intel /quotes/zigman/20392 /quotes/nls/intc INTC and Microsoft /quotes/zigman/20493 /quotes/nls/msft MSFT . 
 
 However, other firms in the newer social media space are also getting generous multiples, for the most part. Even with its stock down more than 50% over the last three months, social game maker Zynga /quotes/zigman/7720406 /quotes/nls/znga ZNGA trades at more than 23 times estimated earnings for the current fiscal year. Daily deals maker Groupon /quotes/zigman/7212269 /quotes/nls/grpn GRPN trades about 64 times estimated earnings, while professional social network LinkedIn /quotes/zigman/5131883 /quotes/nls/lnkd LNKD trades at more than 145 times estimated earnings. Yelp is projected to report a loss in 2012, but compared against analysts’ estimates for its 2013 fiscal year, the online reviews site trades at a forward P/E ratio of just below 200. 
 
 - Dan Gallagher ||||| Facebook Inc. shares slid an additional 9.6% Tuesday, as options trading began and investors placed largely negative bets on the stock’s future. 
 
 Tuesday’s decline to $28.84 puts shares of the social-networking company down 24% from their initial public offering at $38 apiece. Facebook’s debut has been one of the worst performing of any large company, according to data tracker Dealogic. 
 
 The Menlo Park, Calif., company is now valued at $79 billion, compared with $104 billion at the time of its IPO. Chief Executive and co-founder Mark Zuckerberg has seen the value of his stake sliced to about $14.5 billion from $19.1 billion. 
 
 Since Facebook eked out a small gain on its first day of trading May 18 with the support of its lead IPO banker Morgan Stanley, the stock has slid amid both fallout from technical glitches as well as questions about whether the offering’s size and price together overwhelmed demand. Facebook has seen big drops in three of its six full days of trading. 
 
 The lingering concerns about the company’s shares were aggravated by the options-market debut, which allows investors to bet on the future of the stock with less money at risk. Facebook options kicked off trading with a burst of activity, as traders bet the beaten-down shares have further to fall. That is a sharp contrast to the excitement leading up to Facebook’s IPO, when many investors clamored to get a piece of the company. 
 
 “It’s pretty stunning to watch,” said Keith Bliss, a New York Stock Exchange floor trader and senior vice president at Cuttone & Co. “I haven’t seen a turnaround in sentiment this severe in 15 years, and certainly not for an IPO.” 
 
 Facebook, in a so-called quiet period following its offering, has declined to comment on the share-price decline. 
 
 Facebook’s latest stumble came in spite of a broader market rally. The Dow Jones Industrial Average rose 1% and the Nasdaq Composite Index gained 1.2%, as technology stocks led much of the day’s advance. 
 
 An option is a contract that allows investors to bet on a stock’s direction, and as is typical for IPOs, options trading for Facebook began about a week after its stock-market debut. 
 
 In order to begin listing options on a company, exchanges must first propose the terms of the options and file for approval with Options Clearing Corp., an industry clearinghouse. While it first approved the listing of options with prices as low as $16, one exchange later applied to change that low to $1. When one exchange enacted the change, the others followed. 
 
 The trading in Facebook options Tuesday by investors big and small was intense and largely bearish. Trading set a record for any option making its debut, according to data provider Trade Alert, with nearly 365,000 contracts changing hands. Among company options, only Apple Inc.’s were more active on Tuesday. 
 
 The largest option trades bet that Facebook shares would continue to fall. These trades used options known as “puts” to wager on Facebook slipping to $25 a share by mid-July. Puts are contracts that give the buyer the right to sell stock later for a set price. These particular bets maximize their profit if the stock trades at $25. 
 
 A $25 price is considerably lower than where analysts are valuing the stock. Many analysts covering the company say the stock is worth more than its current price, with firms that recommend clients buy the stock putting price estimates on Facebook at between $40 and $48 a share. Some firms with “sell” ratings on the stock earlier had advised a $30 price target. 
 
 While bearish bets drew the most options activity, some traders were bullish, wagering shares would reach $65 by January 2014. 
 
 A declining share price doesn’t necessarily hurt a company financially—Facebook still had one of the biggest U.S. IPOs ever, raising $16 billion. But in general, corporate directors and executives pay close attention to a company’s shares as a real-time measure of performance. Shares can also be important for recruiting and retaining employees, and can serve as a currency for acquisitions. 
 
 So-called momentum stock traders were watching the opening of the options trading in the company with particular attention, said Cuttone & Co.’s Mr. Bliss. When trading took off in the first half-hour, with most wagers bearish, the momentum traders who try to capitalize on shifts in a share price’s direction sprung into action, he said. 
 
 “The momentum guys…make a decision about which way this stock is going, and then they long or short it and it becomes a self-fulfilling prophecy,” he said. 
 
 Even before Tuesday, traders were able to “short” shares of Facebook, as a way to express a bearish bet, essentially selling borrowed shares in hopes of being able to buy them later at a lower price. Around 2:16 p.m. Tuesday, Facebook shares were down 10%, triggering a so-called circuit breaker that limited short selling for the rest of the session and through the close of trading Wednesday. 
 
 However, options give investors an easily accessible and, some argue, less risky way to bet on a stock’s gyrations. 
 
 By buying a bearish option on Facebook rather than shorting the stock, for instance, investors can reap the gains of declines in Facebook, while capping any potential losses were shares to rebound. In contrast, if an investor were to short Facebook, any sharp rise in the stock could leave a bearish investor with hefty losses. 
 
 A significant portion of the activity in Facebook options Tuesday came in small batches of contracts, suggesting interest from small investors, according to Jeff Shaw, head of trading at Timber Hill, the market-making unit of Interactive Brokers. “There is a fairly large individual presence in this activity,” he said. Market makers are professionals who take the other side of investors’ trades. 
 
 One person making bearish bets Tuesday was Janet Tavakoli, who runs a structured-finance consultancy. 
 
 She decided to bet against the shares with her own money, she said, and purchased 100 contracts in September $25 puts, dated to after the expiration of the first wave of so-called lockups that restrict sales by early investors. 
 
 She is essentially wagering the stock will go below that price by then. 
 
 “I thought, given that the puts are available, let me make the point that I think this is full of hot air,” she said, pointing to Facebook’s mobile strategy and valuation relative to earnings as what she sees as problems for the shares. 
 
 Some people were willing to take the other side of those types of trades. Douglas Estadt, founder of Pennwall Capital, with about $10 million under management, said he had sold 65 contracts in June $26 puts and June $25 puts as a means of collecting income while also offering a good entry point to buy the stock. 
 
 Selling the contracts, which cover 6,500 shares of Facebook, allowed Mr. Estadt to collect between 20 cents and 35 cents a share. If Facebook’s stock stays above the $26 level, Mr. Estadt gets to keep those proceeds. If the stock falls, Mr. Estadt could be obligated to buy Facebook shares at the $26 and $25 level. 
 
 “Either way, I’m doing pretty well. Either I collect the premium or own the shares very cheaply,” Mr. Estadt said. “I’d be happy to own Facebook at these prices. Facebook is profitable, and I think it will grow.” 
 
 –David Benoit, 
 
 Drew FitzGerald 
 
 and Alexandra Scaggs contributed to this article. ||||| An investor holds prospectus explaining the Facebook stock after attending a show for Facebook Inc's initial public offering at the Four Season's Hotel in Boston, Massachusetts May 8, 2012. 
 
 NEW YORK/SAN FRANCISCO Facebook Inc increased the price range on its initial public offering an average of 14 percent to raise more than $12 billion, giving the world's No. 1 social network a valuation potentially exceeding $100 billion. 
 
 The company, founded eight years ago by Mark Zuckerberg in a Harvard dorm room, raised the target range to between $34 and $38 per share in response to strong demand, from $28 to $35, according to a filing with the U.S. Securities and Exchange Commission on Tuesday. 
 
 That would value Facebook at roughly $93 billion to $104 billion, rivaling the market capitalization of Internet powerhouses such as Amazon.com Inc, and exceeding that of Hewlett-Packard Co and Dell Inc combined. 
 
 Facebook also extended the time frame for its $1 billion acquisition of mobile app maker Instagram, projecting that the deal would close in 2012 instead of closing in the second quarter as it had previously indicated. 
 
 Facebook provided no reason for the change, though a source familiar with the matter told Reuters last week that the U.S. Federal Trade Commission has reached out to Google Inc and Twitter as part of the agency's standard review for deals of that size. 
 
 The price increase indicates intense market demand, which means Facebook's shares are likely to see a big pop on their first day of trading on the Nasdaq on Friday, analysts said. 
 
 "It's confounding but the evidence is that if companies raise the range, they will pop more," said Josef Schuster, founder of Chicago-based financial services firm IPOX Schuster LLC. "It signals that there is such a strong demand that it will create a momentum for other investors who want to jump on." 
 
 Facebook said in its latest filing that it arrived at the higher IPO price range after one week of marketing the offering - part of a cross-country "road show" in which CEO Zuckerberg has occasionally taken the stage to lay out his vision for the company's money-making potential and its top priorities. 
 
 The Facebook range hike, coupled with strong results from Internet and social media players Groupon Inc and China's RenRen Inc overnight, contributed to a dotcom rally on Wall Street on Tuesday. 
 
 Shares of Pandora Media Inc were up 6.9 percent at $10.50 in afternoon trading, while Zynga Inc was up 8.3 percent at $8.61. Groupon was up 13.7 percent at $13.33, while Renren gained 9.5 percent to $6.01. Yelp Inc stock was up 7.5 pct at $21.55. 
 
 In the biggest-ever IPO to emerge from Silicon Valley, Facebook will raise $12.1 billion based on the midpoint price of $36 and the 337.4 million shares on offer, or 12.3 percent of the company. 
 
 At this midpoint, Facebook would be valued at roughly 27 times its 2011 annual revenue, or 99 times earnings. When Google went public in 2004 at a valuation of $23 billion, it was valued at 16 times trailing revenue and 218 times earnings. Apple Inc, meanwhile, went public in 1980 at a valuation of 25 times revenue and 102 times earnings. 
 
 Wall Street had expected Facebook to increase its price range, with investors eager to get a slice of a strong consumer brand. The IPO road show began last week and has drawn crowds of investors from coast to coast. 
 
 Facebook plans to close the books on its IPO later on Tuesday, two days ahead of schedule, a source familiar with the deal told Reuters on Monday. It is scheduled to price its shares on Thursday and begin trading on the Nasdaq on Friday. 
 
 The IPO is already "well-oversubscribed," which is why the company will close its books earlier than expected, the source said. 
 
 Facebook's capital-raising target far outstrips other big Internet IPOs. Google raised just shy of $2 billion in 2004, while last year Groupon tapped investors for $700 million and Zynga raked in $1 billion. 
 
 The IPO comes amid concerns from some investors that Facebook has not yet figured out a way to make money from an increasing number of users who access the social network on mobile devices such as smartphones. Revenue growth from Facebook's online advertising business has also slowed in recent months. 
 
 Company executives met with prospective investors in Chicago on Monday and were slated to travel to Kansas City, Missouri, and Denver, before returning to Facebook's Menlo Park, California, headquarters. 
 
 A host of Wall Street banks are underwriting Facebook's offering, with Morgan Stanley, JPMorgan and Goldman Sachs serving as leads. Facebook will trade on the Nasdaq under the symbol "FB." 
 
 (Reporting By Olivia Oran in New York and Alexei Oreskovic in San Francisco, additional reporting by Tanya Agrawal; Editing by Maureen Bavdek and Matthew Lewis)
– Facebook shares continue to plummet: They've now dropped more than 20% from their $38 IPO price, falling below $30 today to their lowest point yet, reports Reuters. At about 12:45pm EDT they were trading at $29.44. But among tech stocks, $30 per share still gives it a comparatively "generous" valuation, notes Dan Gallagher at MarketWatch: The site is trading at about 55 times its estimated earnings for this fiscal year. Google, on the other hand, trades at about 14 times its estimated earnings, and Apple, IBM, and Microsoft are in the same ballpark. But he notes that higher valuations seem more common among social sites: Groupon trades at some 64 times its estimated earnings, while LinkedIn is trading at a hefty 145 times its estimated earnings.