Zynga’s Stock in a Free Fall; Can Enrique Iglesias and Jennifer Lopez Make It Sing?

Zynga’s stock dropped like the proverbial rock today, sliding more than 12 percent at one point to close at $4.98 a share.

The social game company’s shares are now officially down 50 percent from its December public offering when it sold shares for $10 apiece to raise $1 billion.

Its troubles can be blamed on a number of factors, including Facebook’s poor public performance and persisting questions on how both companies — Facebook and Zynga — will be able to gracefully transition from the Web to mobile.

But at least this time Zynga’s steep decline doesn’t seem to be tied to Facebook, which was up 1.5 percent, or 40 cents today, to close at $27.40 a share. And, as Kara Swisher pointed out earlier today, many public tech companies continue to perform well.

Forbes reported that Cowen analyst Doug Creutz warned in a research note today that new data suggests game playing on Facebook is in an “accelerating user tailspin.” Additionally, he said that Zynga’s daily active users were down 8.2 percent in May, the second consecutive significant month-over-month drop, “with nearly all of the company’s major titles declining significantly.”

In an interview on CNBC, Creutz elaborated, saying there were two reasons he was concerned: First, over the past few months, Zynga accelerated the number of game launches, but because the games were not substantially different, players jumped from one game to the next too easily. Second, while Zynga is aggressively going after the mobile games market, it’s still uncertain if it will be successful in making the transition.

To that end, Zynga announced a partnership with Enrique Iglesias and Jennifer Lopez to help promote the company’s recently acquired Draw Something game.

Zynga was criticized for overpaying for Draw Something’s creator OMGPOP because almost immediately after paying $180 million for it, the game started to lose its appeal. The game is now Zynga’s third largest on Facebook, with 5.6 million daily active players, down from 14.4 million at the time of the sale.

Still, the game could make a comeback, especially as Zynga begins to put its full force behind the indie production.

Zynga said it was launching Draw Something in 12 new languages, including Chinese, Korean and Japanese. To assist in the international launch, players will be able to select the “JLo Enrique” feature to unlock special words that they will have to draw.

Both artists have agreed to engage players of Draw Something on Twitter during the week-long promotion in the lead-up to their North American tour, starting July 14.

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— Valleywag editor Sam Biddle