I don’t have to tell you what’s been going on with shares of Facebook, down over 50% from its IPO price. On Thursday a lockup for certain owners of Facebook expired, which was widely watched by many on Wall Street. One thing that I think that has been missed is that wasn’t the only lockup for $FB shares. There are still three more with the largest one coming in November.
From the WSJ:
Employees who own Facebook shares are only able to watch at this point. Lockup expirations in October, November and December will allow Mr. Zuckerberg and other employees to sell more than 1.4 billion shares. The biggest lockup expiration, freeing more than one billion shares, is set for Nov. 14. The last lockup expires next May.
For many employees, however, selling shares later this year may not be a palatable option. Facebook’s stock has so far fallen about 48% since the IPO, pushing its market capitalization down to about $42.6 billion.
So you started working for the giant social media company and were offered shares before the company went public. You were probably thinking you’d be able to retire at the ripe old age of 32, only to see your Zuckerberg- sponsored retirement get cut in half.
I’ve seen a lot of people discussing the recent lockup expiration, calling for the coast to be clear now that all the built-in sellers are gone. This just isn’t the case, as the WSJ article states, there are still three more lockup periods to expire. Will shares continue to sink into the abyss as the remaining lockups expire? Beats me, my crystal ball is still in the shop. As always, create a plan that works for your risk appetite and stick to it.
Henry Blodget over at Business Insider also wrote a great piece today directed at Facebook employees.Disclosure page for full disclaimer. Connect with Andrew on Google+.