Insider Selling

Snap Inc stock declines and more Form 144s arrive

Based in Los Angeles, Snap Inc (SNAP: US) is a tech company known mostly for its most popular product, Snapchat, a camera and social media app which was named the fifth most downloaded app globally according to a 2o22 list by Forbes

As with most stocks this year, due to multiple factors, SNAP has been facing a steady decline. The stock has declined by 79.52% year-to-date; most notable, the stock tumbled by 39.08% in a single day. The latter incident took place on July 22, when the stock closed at $9.96, a value significantly lower than $16.35, SNAP’s closing price the previous day. 

Latest Insiders to file Form 144s

Back in April’22, 2iQ Analysts reported about Snap’s Insiders sending in one Form 144 after another. Following up with that, two more Insiders joined the others in selling their shares on July 25, each for an estimated $9.95 price per share:

  • Robert Cornelius Murphy - Co-founder and CTO filed his form 144 via the broker, Wells Fargo Advisors. The worth of these 900,000 shares came to nearly $8.96 million

  • A Director on the board, Joanna Coles, filed her form for 20,000 shares. Valued at almost $199,000, this form was filed through broker Charles Schwab & Co Inc

Later on the same day, both Murphy and Coles sold all the shares they had listed in the above forms but for changed values. Murphy sold all his 900,000 shares for a slightly smaller rate of $9.8 whereas Coles sold her 20,000 shares for a slightly higher net value of $10.0 each.

Customer-friendly but not Investor friendly

On July 20, 2022, Snap Inc was recognized b the American Association of People with Disabilities (AADP) as “DEI Best Place to Work for Disability Inclusion”. The company’s recent earnings report for 2022’s second quarter mentioned the rise of its Daily Active Users which reached 347 million year-over-year; high anticipation follows as the number could reach 360 million in Q3, according to the quarter’s investor letter. The report also disclosed a Stock repurchase program of up to $500 million worth of Class A common stock. 

But the earnings announcement had other points to ponder which sent the stock diving when they came out on Thursday. An article published the same day called out Snap Inc for not being an “investor-friendly” company. It was stated in the aforementioned investor letter that the company would be aiming for a stock split, which quite blatantly will be to help protect its founders. Since the company’s IPO in 2017, Snap’s co-founders - Murphy and CEO Evan Spiegel - have held the largest percentage of the company’s voting rights. 

This information, coupled with Insiders continually coming forth with forms is highlighting a downturn in SNAP stock’s performance. Perhaps a return could be in sight thanks to Snapchat and the company’s latest offering, Snapchat+.

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