About 800 million shares of Facebook Inc (NASDAQ:FB) are being released from lock-up today. However indications from early trades suggest that the stock is not being impacted by the expiry of lock-in.
Shares in the social networking site were up 9 percent at $21.63 with 23 million in the opening 20 minutes.
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Previous expiry of lock-ins have been attended by massive share sales as early insider investors preferred to exit the company with uncertainty surrounding the company’s growth prospects.
The first wave of about 270 million unlocked shares in mid-August was among the factors that pushed the stock down to its record low of $17.55 in early September.
The second lockup wave of shares (mostly held by Facebook employees) caused the stock to slide last month, slipping below the $19 mark just days before the third-quarter earnings report.
However its results for the third quarter ending September showed that the company was growing healthily and the revenues from mobile ads showed an unexpected rise.
This may induce investors to hold on their shares. There's no doubt that Wall Street sentiments towards Facebook shares have improved. There have been some upgrades of the stock in recent weeks and price targets have been moved up to beyond $30 a share.
Today's lock-up expiration will add a little more than 800 million shares to its exiting float of about 920 million shares, according to information from its filing with the Securities and Exchange Commission.