Reddit share value 86% up on IPO price; could be good for tech | Tech

Reddit Share Value.jpg

Redditors who took advantage of their privileged access to stock ahead of the IPO have seen Reddit share value rocket from $34 to $59.80 by yesterday’s close – an 86% increase.

Update: Subsequent share sales by the company’s CEO and COO – coupled to a report describing the stock as “grossly overvalued” – saw the price fall to $49.32, below the closing price on the day of the IPO …

CNBC reports on the latest development:

Reddit shares began their downward spiral on Wednesday, when they sank about 11% to $57.75 at market close. That day, Hedgeye Risk Management described Reddit’s stock as “grossly overvalued” in a report cited by Bloomberg News, adding the company was on the firm’s “short bench.”

Earlier this week, Reddit disclosed in a corporate filing that CEO Steve Huffman sold 500,000 shares. Ben Silverman, vice president of research at Verity, told CNBC the move was expected and represents just “a portion of his holdings.”

Meanwhile, Reddit Chief Operating Officer Jennifer Wong disclosed that she sold 514,000 shares and now holds 1.4 million of the company’s shares.

While an IPO does provide existing shareholders with an opportunity to convert some of their paper wealth to cash, and isn’t an entirely unexpected development, the scale of the sales is leading some to question the execs’ faith in the company.

Original story follows:

Early private investors have seen even greater returns, with OpenAI CEO Sam Altman seeing his own stake in the company grow from $200M to over $600M – and some analysts believe market confidence in the stock could be good news for the tech sector as a whole…

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