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The Five Dumbest Things on Wall Street This Week: June 15

4. Zynga's Pac-Man Moment

Will somebody please tell us why there is such surprise over Zynga's (ZNGA - Get Report) recent meltdown? Maybe it's because we are old enough to remember when Pac-Man fever finally broke, but we simply don't see it as shocking in the least.

Shares of the social gaming company fell 10% Tuesday to $5 on the heels of a Wall Street analyst report that said sales at the company are hurting as more of its thumb-happy players are amusing themselves on smartphones as opposed to social networks.

For those who may have forgotten, Zynga sold 100 million shares at $10 each in its December IPO, making it the largest Internet-related IPO since Google's (GOOG) $1.4 billion offering back in 2004.

"We believe that interest in Facebook-based gaming may have reached a negative inflection point as more casual gamers migrate to mobile platforms," wrote the folks at Cowen & Co., adding that the market for games on Facebook (FB) was in an "accelerating user tailspin."

Thanks guys, yet we don't need Donkey Kong to kick us in the head to alert us to Facebook's problems, especially its slowing growth or mobile troubles. In fact, it was only this past Monday that ComScore came out with the latest sorry news about Facebook, saying its unique U.S. visitors rose 5% in April to 158 million, the slowest growth rate since ComScore began tracking the data in 2008.

Furthermore, we also don't need to be reminded that Zynga is symbiotically tied to Zuck's baby tighter than the two starfighters you get in Galaga after you shoot down an enemy alien that steals your space ship. Zynga shares 30% of its revenue with Facebook when gamers go shopping on the social network, so when Facebook misfires, it's Zynga who crashes first. (Don't remember Galaga or Donkey Kong? Really? Ah don't worry, at some point you won't remember FarmVille either.)

Of course, Zynga's insiders including CEO Mark Pincus are already safe and secure in the bonus round, having sold nearly $600 million in stock this spring. So while Wall Street seems astonished to see Zynga shares falling like Asteroids (remember that arcade classic?), the folks behind the controls clearly foresaw impending Doom (and that one) and bailed out.

Then again, you can always count on Wall Street analysts to arrive on the scene once the game is over.
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