FB Lockup Expiration: Nothing to Fear?
However, the social network’s position has changed over the past several months. Chief Executive Officer Mark Zuckerberg has increasingly focused on monetization efforts, and as evidence of that commitment, Facebook reported in October that sales had risen 32 percent to $1.26 billion in the third quarter. Since September, shares have gained 50 percent and after the November expiration they jumped above $20 per share.
CHEAT SHEET Analysis: Is this a Positive Catalyst for Facebook’s Stock?
One of the core components of our CHEAT SHEET Investing Framework focuses on catalysts that will move a company’s stock. The 156 million shares that will be released from lock-up on Friday are a much smaller addition to Facebook’s float than the number of shares that were released in October and November. Given increased investor confidence in the stock and November’s precedent, Facebook’s last scheduled expiration is not expected to reverse the stock’s upward trend.
Although the company’s shares still trade approximately 27 percent below their IPO price, Forbes noted that “navigating through the share lock-up gauntlet is a huge milestone for the stock.”
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