Facebook hasn't been a good investment for many insurance companies.
A Pennsylvania insurer that has been making a marketing push in Columbus is nursing some wounds it got from an investment in Facebook Inc.
Erie Insurance Group bought more than 70,000 shares of the social networking company as it got in near the ground floor of Facebook?s much-hyped initial public offering in May, according to data compiled by SNL Financial LC. Erie has lost 12.7 percent of its investment after selling 24,170 shares in the third quarter as Facebook?s stock price struggled to meet expectations.
After shooting up to $45 on its first day of trading, Facebook?s share price has plunged more than 40 percent to an adjusted close of $26.97 a share Thursday.
Among insurance companies, Erie was one of the largest remaining investors in Facebook (NASDAQ:FB) at the end of the third quarter, holding 45,900 shares, SNL says. Only Dorinco Reinsurance Co. held more Facebook stock. Although some insurers made good bets on when to sell Facebook stock and turned a profit, the industry as a whole has not fared well in its tech investment. Insurers bought 959,119 shares of Facebook during the second and third quarters and sold 783,644 shares, SNL said, for a loss of 9.6 percent on the investment.
Rick Rouan covers banking, capital markets, insurance, logistics, nonprofits, area airports and air travel for Business First.
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Source: http://feedproxy.google.com/~r/vertical_4/~3/WsJ-gaEmWaU/erie-insurance-dumps-facebook-takes.html
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