Groupon stock tumbles as IPO lock-up period ends
Groupon's stock tumbled Friday as insiders sold their shares after a post-IPO prohibition was lifted.Updated: Jun 02, 2012, 13:29 IST
Groupon's stock tumbled Friday as insiders sold their shares after a post-IPO prohibition was lifted.
Employees and other insiders are required to wait before selling their stock following a company's initial public offering. Groupon's lock-up period expired on Friday. The company went public on Nov. 4.
Shares of Groupon Inc. fell 95 cents, or 8.9 percent, to close at $9.69 Friday. Earlier, the stock was trading as low as $9.53. That's the lowest since its IPO, which priced at $20.
Groupon makes money by selling online deals for spas, restaurants and weekend getaways. Though it recently reported a good quarter, its stock has been battered due to a series of missteps with its finances.
In March, the Chicago-based company restated its quarterly financial results, explaining that it lost more than it initially reported because it had to pay out more refunds than expected. In May, it replaced two of its board members to add executives with more accounting experience.
Friday was a bad day for the overall stock market, too. A closely watched report showed that the U.S. economy added far fewer jobs than expected last month.
Other social media company stocks declined as well.
Shares of Facebook Inc. dropped $1.88, or 6.4 percent, to close at $27.72. That's down 27 percent from its IPO price of $38.
Shares of online game maker Zynga Inc. slid 25 cents, or 4 percent, to $6.01. LinkedIn Corp., the online social network for professionals, fell $4.59, or 4.8 percent, to $91.51.
Online reviews site Yelp Inc., meanwhile, fell $1.02, or 6.1 percent, to $15.69.