Tomorrow, Twitter Inc. (NASDAQ:TWTR) insiders will finally get the opportunity to sell their shares of the stock. This may be a treat since Twitter’s stock market price has doubled since its debut in November.
The amount of non-executive employees’ shares goes up to 9.87 million. These shares were locked up for a brief period, after the IPO, according to filings with the U.S. Securities and Exchanges commission. Once they have the ability to sell their shares, it will boost the availability of Twitter shares to 90 million, or an increase of 12%. Not to mention, more shares will become accessible in May.
Due to slower growth and a maturity in the sign up arena, Twitter’s stock price has plunged by about 14% since last week. The expiration of the lockup may temporarily lower Twitter’s share price, but it will also give a more accurate valuation, as well.
Since none of Twitter’s insiders sold their stocks during the IPO, they haven’t yet made any profits on it either. Some of Twitter’s largest shareholders include co-founder Evan Williams, who has a 10% ownership. In addition, Rizvi Traverse Management LLC owns a 16% stake. Other shareholders include Ashton Kutcher, Benchmark Capital, Spark Capital and Union Square Ventures.
Investors hope the lockup expiration won’t affect the stock price too much. It wasn’t too long ago when Facebook was in the same situation, and their stock price dropped much more significantly than expected. However, Facebook recovered, and Twitter may very well do the same.
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