Previous Thread
Next Thread
Print Thread
Rate Thread
Joined: Oct 2003
Posts: 1,449
IceMyst Offline OP
UGN Elite Poster
OP Offline
UGN Elite Poster
Joined: Oct 2003
Posts: 1,449
176 million new shares will be eligible for sale on Feb. 14. Will the lofty price hold?

BOSTON (CNN/Money) - On Feb. 14, 176 million shares of Google stock, which have been locked up under the company's complex stock-release program, are scheduled to hit the market. As economists never tire of pointing out, more supply without more demand means that the price will drop.

On the eve of this date, the question potential investors -- and short-term Google holders -- must ask is this: Is Google's foundation in the market strong enough to withstand this flood, or will it groan and collapse under the weight?

The 176 million shares represent 65 percent of the total outstanding shares, and they will more than double the current float of 127.7 million shares. This offering will be the fifth post-IPO release from Google, and by far the largest.

According to Janco Partners analyst Martin Pyykkonen, in this stage of the game, typically 20 percent of the shares freed up by a post-IPO lockup expiration are sold. But Google's IPO and post-IPO process have been anything but typical. IPOs usually have 180-day lockup periods, "but it's rarely as much of the total outstanding share percentage as this one," Pyykkonen says.
Turbulence ahead?

Google's average daily volume is 10.8 million shares. If just 20 percent of the 176 million shares are in fact sold, that will equate to roughly three times the normal trading volume.

"Major lockups always create turbulence in shares," says Mark Mahaney, an analyst with American Technology Research. "Usually we see a trade-off going into lockups."

Of course, the recent Google activity could hardly be considered a trade-off, with the company reaching a new 52-week high on Feb. 2, although the stock is down about 7 percent from that high.

Still, for rank-and-file employees, the temptation to cash in on stock trading north of $200 per share must be overwhelming, especially for those who experienced the bubble and saw previous paper gains disappear (or who've heard the old-timers in their 30s talk about it). Roughly 45 million shares are owned by non-director employees.

"This is God-given chance to make me rich," wrote amy_lu123 on Google's Yahoo! Finance board, in a post titled "I am a GOOG employee."

While the verity of amy_lu123's claim can't be confirmed, the sentiment is a very real one that must be rushing through more than a few Google employees' heads. "The high price definitely creates pressure to sell," Pyykkonen says.

That desire must be doubly true for the VCs who invested in Google and own some 42 million shares. In the past six months, only 6.4 million shares have been sold by insiders.
Keeping good thoughts in mind

However, true to Google's norm-defying nature, some factors may align to keep the price afloat despite the massive influx of available shares.

The flood hits just after a tremendous fourth quarter, one in which the company -- which doesn't give guidance -- made some very bullish comments, saying it saw no price resistance from advertising customers and could raise prices if it needed to.

On Feb. 9, Google will hold its first analysts day, which should give a clearer picture of what the company is up to and what its plans are.

"As long as Google management doesn't come out looking like Martians on analysts day, there will be a strong bid to the shares," Mahaney says. If you still want in on Google, tune in to that meeting.


Joined: Feb 2002
Posts: 7,203
Likes: 11
Community Owner
Community Owner
Joined: Feb 2002
Posts: 7,203
Likes: 11
I so want some google stock, but I don't think it's really worth it right now at the current price and I expect (at least) a small drop, so I guess i'll wait hehe...

Donate to UGN Security here.
UGN Security, Back of the Web, and VNC Web Services Owner
Joined: Dec 2002
Posts: 3,255
Likes: 3
UGN Elite
UGN Elite
Joined: Dec 2002
Posts: 3,255
Likes: 3
it will drop. Sure as [censored] it will drop, if you bought now you would take a loss. Me I want some SBC stock. If they swallow AT&T they will be the largest telco in the world. 29% market share. Making verizon #2 with 17% market share.

The google train has left the station and will be back once someone (betting on Microsoft) finds a way to steal some of thier thunder.

Link Copied to Clipboard
Member Spotlight
The Beach
Posts: 616
Joined: October 2002
Forum Statistics
Average Daily Posts1
Most Online3,253
Jan 13th, 2020
Latest Postings
by JohanKaariainen - 08/15/19 01:18 AM
by Gremelin - 10/03/18 07:02 PM
my old account still exists!
by Crime - 08/10/18 02:47 PM
Okay WTF?
by HenryMiring - 09/27/17 01:45 AM
The History Thread...
by Gremelin - 08/11/17 12:11 PM
My friend NEEDS your HELP!
by Lena01 - 07/21/17 12:06 AM
I'm having fun with this guy.
by gabithompson730 - 07/20/17 01:50 AM
I want to upgrade my phone
by gabithompson730 - 07/20/17 01:49 AM
Doom 3
by Cyrez - 09/11/14 08:58 PM
Amazon Gift Card Generator/KeyGen?te
by Gecko666 - 08/22/14 09:21 AM
AIM scene 99-03
by lavos - 09/02/13 08:06 AM
Planetside 2
by Crime - 03/04/13 07:10 AM
Beta Testers Wanted
by Crime - 03/04/13 06:55 AM
Hello Everyone
by Gremelin - 02/12/12 06:01 PM
Tracfone ESN Generator
by Zanvin Green - 01/18/12 01:31 PM
Python 3 issue
by Testing - 12/17/11 09:28 PM
tracfone airtime
by Drache86 - 07/30/11 03:37 AM
Backdoors and the Infinite
by ZeroCoolStar - 07/10/11 03:52 AM
Where and how do you torrent?
by ZeroCoolStar - 07/06/11 07:22 AM
HackThisZIne #12 Releaseed!
by Pipat2 - 04/28/11 09:20 PM
gang wars? l33t-wars?
by Gremelin - 04/28/11 05:56 AM
Consolidate Forums
by diggin2deep - 04/21/11 10:02 AM
LAN Hacking Noob
by Gremelin - 03/12/11 12:42 AM
Top Posters
UGN Security 41,392
Gremelin 7,203
§intå× 3,255
SilentRage 1,273
Ice 1,146
pergesu 1,136
Infinite 1,041
jonconley 955
Girlie 908
unreal 860
Top Likes Received
Ghost 2
Girlie 1
unreal 1
Crime 1
Ice 1
Dartur 1
Powered by UBB.threads™ PHP Forum Software 7.7.5