Shares of Zillow, the Seattle online real estate company, lost more than thirteen percent of their value today after employees and other early investors were able to sell shares for the first time in the public markets. The stock was down by nearly 20 percent at one point in trading this morning after the so-called “lock-up” period expired on some shares held by insiders.
Bloomberg noted that Zillow was the biggest decliner in the Russell 2000 Index, dipping below $23 per share at one point. The shares are now at about $23.50 — still up when compared to the $20 IPO price in July.
Justin Patterson, an analyst at Morgan Keegan & Co., told Bloomberg that the stock “is being pressured by sales from pre-IPO investors now that a lock-up period has ended.”
As GeekWire previously reported, insiders at the company were permitted to sell a portion of their shares beginning today after the stock stayed above certain price milestones.
Typically, companies enter into 180-day lock-up agreements with insiders following an IPO, but in the case of Zillow employees and other shareholders were permitted to sell after 90 days given terms established by the company and its investment bankers.
Up until this point, Zillow had been one of the top performing IPOs in the tech industry. Profitable and growing, the company just overtook Realtor.com to claim the title as second most visited online real estate site in the country, according to Hitwise.
Today’s sell-off means that Zillow now has a market value of about $651 million.