Facebook shares plummet nearly 4 percent when the company’s own employees dump shares
Facebook shares plummet nearly 4 percent when the company's own employees dump shares
- Stock fell by 83 cents and closed at $ 21.11
- The company fell by 3.79 percent after trading 99 million shares
- CEO Mark Zuckerberg says he will not sell his shares until September
The market value of Facebook was attacked by its own employees on Wednesday because they dumped millions of shares they had in the company.
The social networking giant ended the day with 3.79 percent after 99 million shares changed ownership.
Company inventory fell by 83 cents and closed Wednesday at $ 21.11. The share is 44 percent lower than the IPO price of $ 38.
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Facebook CEO Mark Zuckerberg says he won't sell his shares this year
Wednesday was the first time that employees with 234 million shares could sell their Facebook shares.
A lock-up period, which forced them to hold their shares after the IPO of the company, expired on Monday.
On Mondays and Tuesdays, however, the markets were closed due to Superstorm Sandy, so employees had to wait until Wednesday.
On average, 50 million shares of Facebook shares are traded daily. The trading volume rose to more than 9 billion on Wednesday.
The company's IPO in May was valued at $ 38 per share. The price was $ 21.11 at the end of the trade on Monday.
The Nasdaq chart shows that Facebook shares ended the day at just over $ 21
CEO Mark Zuckerberg does not sell. He has already said that he will not sell shares until at least next September.
A total of 234 million additional shares and stock options held by employees on October 15 were eligible to flood the market.
Lock-ups are common after the initial public stock offering and are intended to prevent a share from experiencing the kind of volatility that could occur if too many shareholders decided to sell at once.
Facebook saw its largest one-day win last Wednesday after posting strong results in the third quarter.
The day before, Facebook explained for the first time how much money it earns with mobile ads. Mobile was a problem since Menlo Park in California, the company's IPO.
Facebook's stock has not performed well since the IPO in May due to concerns about the ability to sustain revenue growth. But the next lock-up expires on November 14, when 777 million shares and stock options are eligible to be sold.
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