Snapchat’s stock dropped as its IPO “lockup” period expired Monday, allowing early insiders and employees to sell up to 400 million shares.

Snap shares were down 3 percent in premarket trade Monday morning to about $13.42 a share. The stock first fell below its $17 IPO price in July and has been under tremendous pressure into this lock-up expiration, down 22 percent in the last month.

Since its initial public offering on March 2, insiders including CEO Evan Spiegel have been barred from selling Snap shares, even as the social media company struggles on Wall Street.

However, early investors and insiders including Spiegel, CTO Robert Murphy and Lightspeed Ventures will be able to sell up to 400 million shares starting Monday, according to a report by JPMorgan analyst Doug Anmuth. Other employees will be able to sell up to an additional 782 million shares on Aug. 14. About 97 percent of Snap stock will be available for trading by the end of August, Anmuth said.

The social media company disappointed analysts after its first earnings report in May, largely because many of its features are being imitated by rival Facebook. It added just 8 million users during that quarter, far below the 59 million added by Facebook globally over the same period. Snap is expected to report its next quarterly earnings on August 10.

But it may be time for investors to take a chance on Snap shares, now that the event analysts had feared for months is finally here, history shows.

MKM derivative strategist Jim Strugger noted that many of the now-successful social media companies tracked a similar pattern around their lockup expiration. According to Strugger, over the month preceding Facebook, Twitter, and Linkedin’s “lockup” expiration, their stocks were down by an average of 24 percent, about the same as Snap’s decline.

Past social network stocks around lockup

Source: MKM Research

“Notably, Linkedin, Twitter, and Facebook all bottomed within a week of their lock-up expirations, a bias that points to getting directionally long SNAP down here,” noted Strugger.

Disclosure: CNBC parent NBCUniversal is an investor in Snap.

–With reporting by Michelle Castillo

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