London Daily

Focus on the big picture.
Tuesday, Jun 02, 2026

If You Invested $5,000 in Facebook’s IPO, This Is How Much Money You'd Have Now

If You Invested $5,000 in Facebook’s IPO, This Is How Much Money You'd Have Now

Buying in at the IPO might have been something to brag about in 2012, but patient investors who used a different approach are the ones bragging now.

When a company's stock gets released to the public in an initial public offering (IPO), there's usually not much news coverage outside of the financial media outlets. But that was not the case in 2012 when Facebook (NASDAQ:FB) announced its go-public event. It was hard to avoid the buzz leading up to the stock's release day, and many social networking fans who had never invested in stocks before were interested in getting in on the action.

Let's take a look back at the early years at Facebook to understand why investors were so excited about this company going public. Then we'll dive into the IPO calculations and discuss an alternative approach that would have been even more lucrative.


Facebook was a hit from Day One

It all started in 2004 when then-freshman Harvard student Mark Zuckerberg and his friends started "TheFacebook" as a way for students at the university to connect online. The announcement of the site was sent to an email distribution list of 300 students, but within the first 24 hours, four times that many had registered. In the first few years, the service was only available for college students, but even with that limitation, it reached 6 million members by December 2005. The torrid growth didn't seem to slow down. When the IPO rolled around in May 2012, the platform had an amazing 526 million daily active users across the globe and had achieved a $4 billion annual revenue run rate.

No wonder people were excited about the opportunity to own stock with this amazing growth story.


Getting in at the beginning

The stock was offered at $38 per share via the IPO. Let's assume you bought 132 shares for a total of $5,016 on May 18, 2012, and held all the way through to today. In the meantime, Facebook continued its incredible growth and has turned into a global juggernaut. The table below compares Q1 2012, the last quarter before its IPO, to its most recently reported results for Q2 2019

Shareholders have shared in the company's success. At today's price of around $191 per share, those 132 shares would be worth $25,212, resulting in a market-beating five-bagger.

Any investor should be happy with that result, but there was a way to improve your returns with a simple strategy.


A different approach with better results

Facebook's IPO was largely viewed as a failure. In the days following the stock's release, it dropped - and dropped and dropped. The stock stayed below the $38 mark for months and finally bottomed out in September 2012 below $18.

The shares didn't get back to the initial $38 again until August the following year, a full 16 months later. This was a tough pill to swallow for those who bought on Day One. But one approach that investors can use to help in a case like this is to buy in thirds.

The idea is that you can get in on the stock with a small initial investment but have cash left to invest later. If the stock goes lower, you don't feel too bad, because you have money available and can add to your position at a better price. If the stock starts to rise, as a shareholder, you can be comforted that you are capturing the gains.

With 20/20 hindsight, we can see how this strategy would have paid off for Facebook IPO investors. Let's assume you invested one-third of your available cash at the IPO and the remaining two-thirds split between buys at six months and at one year later.

With this approach, you would have 47 more shares and a 26% lower cost basis. Today, those 179 shares at the $191 price would be worth $34,189, or almost 36% more than just investing at the IPO.

Buying in thirds doesn't always pay off monetarily, but it can help manage your temperament if the stock loses value. Red numbers in your portfolio are tough to look at. Some investors might be tempted to sell, especially when numbers remain in the red for what seems like an eternity. Early Facebook shareholders who chose a buy-in-thirds approach not only would have achieved better results, but more importantly, they were more likely to hold their shares through the first 16 months of disappointing returns.


10 stocks we like better than Facebook

When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has quadrupled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now… and Facebook wasn't one of them! That's right - they think these 10 stocks are even better buys.

Newsletter

Related Articles

0:00
0:00
Close
Japanese Technology Firm Fujitsu Launches Advanced Artificial Intelligence Tool for Corporate Disclosures
South Africa Officially Launches Nationwide Campaign for Highly Contested Local Government Elections
United Kingdom Commits Additional Funding for Unexploded Ordnance Clearance in Laos
Singapore Announces Stringent New Greenhouse Gas Regulations for Commercial Cooling Systems
Cambodia and Thailand Hold High-Level Border Security Talks at United Nations Headquarters
Myanmar Military Government and China Sign Major Agreement to Upgrade Media and Cultural Cooperation
Knife Attack at Swiss Train Station Leaves Three Injured in Suspected Act of Domestic Terrorism
Transnational Extortion Gang Threatens Canadian Police With Army of One Thousand Armed Operatives
Australia Imposes Forty-Two-Day Quarantine on Cruise Ship Passengers Following Deadly Hantavirus Outbreak
International Monetary Fund Unlocks Seven Hundred Million United States Dollars for Sri Lanka Following Economic Reforms
Australia Launches Record One Point Four Billion Dollar Lawsuit Against Chemical Giant 3M Over Contamination
China and Canada Foreign Ministers Meet in Ottawa in Effort to Stabilize Strained Diplomatic Ties
Indonesia Demands Urgent United Nations Security Council Reform Amid Escalating Global Conflicts
Extreme Weather Patterns Trigger Severe Drought in Madagascar and Destructive Flooding in East Africa
Indian State of Karnataka Faces Political Upheaval as Chief Minister Siddaramaiah Abruptly Resigns
Philippines and Japan Reaffirm Defense Ties as Crucial for Indo-Pacific Regional Stability
Norway Joins French Nuclear Deterrence Initiative in Major Shift for European Security Architecture
Global Critical Mineral Alliances Expand as Western Nations Move to Counter Chinese Supply Dominance
United States Imposes Fifty Percent Tariffs on Mexican Steel and Aluminum Ahead of Trade Pact Review
European Union and China Head Toward Major Trade Conflict Over Clean Technology Exports
United States Economic Growth Severely Downgraded to One Point Six Percent as Stagflation Fears Mount
World Health Organization Warns Central African Ebola Epidemic is Outpacing Containment Efforts
United States Treasury Department Conditions Sanctions Relief on Reopening of the Strait of Hormuz
Iranian Air Defenses Intercept and Destroy United States Military Drone Over Bushehr Province
Iranian Armed Forces Launch Ballistic Missiles Toward Unspecified Targets Prompting Regional Condemnation
United Nations Secretary-General Warns Global Order Facing Highest Level of Conflict Since 1945
Israel Issues Sweeping Evacuation Orders in Southern Lebanon Amid Intensified Hezbollah Conflict
Russia Announces Systemic Military Strikes Targeting Ukrainian Defense and Energy Infrastructure
United States and Iranian Negotiators Reach Draft Agreement to Extend Ceasefire and Resume Nuclear Talks
United Nations Security Council Deeply Divided Over United States Capture of Venezuelan President
US and Iran Exchange Direct Military Strikes Amid Fragile Gulf Ceasefire
World Health Organization Warns of Catastrophic Ebola Outbreak in DR Congo
Russia Threatens New Wave of Strikes on Ukrainian Infrastructure and Embassies
Scientists Warn Atlantic Ocean Currents Could Collapse Faster Than Projected
Anthropic Reaches $900 Billion Valuation in Historic AI Funding Round
Washington Imposes Crippling Sanctions on Iranian Maritime Authority
Japan and the Philippines Initiate Strategic Intelligence-Sharing Pact
Microsoft Deploys Autonomous Computer-Using AI Agents to Global Markets
Anthropic Secures $45 Billion Compute Infrastructure Agreement With SpaceX
U.S. Director of National Intelligence Resigns Amid Administration Shakeup
Micron Technology Crosses Trillion-Dollar Valuation Amid Unprecedented Hardware Demand
Canada and Germany Finalize Historic Long-Term LNG Export Agreement
China Expands International Travel Restrictions on Domestic AI Researchers
Japan Approves Sweeping Overhaul of National Intelligence Apparatus
Global Airlines Scramble Logistics as Middle East Airspace Remains Fractured
Japan's Naphtha Imports Plunge 47 Percent Amid Strait of Hormuz Closure
Global Crude Prices Retreat Below $96 as Gulf Tensions Momentarily Ease
Generative AI Outperforms Human Baselines in Landmark Global Creativity Study
NASA Partners With Private Aerospace to Unveil Permanent Lunar Base Architecture
South Korean Equity Markets Surge on Next-Generation Memory Chip Frenzy
×