Zynga execs, investment firms cash out before stock dives

[ElNono]

$516 million in shares sold over the last quarter

Several Zynga senior executives reportedly sold stock in the company ahead of its unexpected $22.8 million net loss. Executives that sold stock include CEO Marc Pingus, CFO David Wehner, COO John Schappert, and general counsel Reginald Davis. In one quarter, Zynga stock fell from a high of $12 to a low of $2.97 per share.

Executives were not the only group to execute well-timed trades prior to the losses. Zynga investors Institutional Venture Partners sold 5.8 million shares for $70 million, Union Square Ventures sold 5.2 million shares for $62 million, and Google sold four million shares for $48 million.

Read more: http://www.electronista.com/articles/12/07/26/516.million.in.shares.sold.over.the.last.quarter/

[clambake]

racket

[Blake]

What does this mean for the games on my phone

[boutons_deux]

insider trading, yawn

[coyotes_geek]

The timing certainly looks bad, but this is about ZNGA's lockup period expiring. We'll probably see something similiar with Facebook when their lockup period expires.

[Viva Las Espuelas]

So I can no longer hang with friends?!??

[Wild Cobra]

Racket?

Well timed?

They probably knew what was likely, but major share holders have to disclose the sales they want to make in advance, and wait to make that sale. The disclosure is there for anyone to see, in fact, instead of having knowledge, their sales may have scared others into selling the stock into a free-fall.

[Nbadan]

Racket?

Well timed?

They probably knew what was likely, but major share holders have to disclose the sales they want to make in advance, and wait to make that sale. The disclosure is there for anyone to see, in fact, instead of having knowledge, their sales may have scared others into selling the stock into a free-fall.



sold stock in the company ahead of its unexpected $22.8 million net loss.

Yeah, the fact that they stood to lose millions with the stock devaluation I'm sure didn't contribute at all to their decision to sell now.....

....and your an idiot...

[vy65]

Lol a buddy of mine bought this shit when it was $8-10 a share.

[ElNono]

I just can't think everything is cozy with this... reeks of insider trading... you can't tell me they didn't know how the company was performing...

[Wild Cobra]

OMG...

I just looked into the insider trading activity of the company.

ElNoKnow...

Shame on you, bringing this smear campaign story without verifying the facts.

Almost all these sales were acquired and sold the same day. That means, these were something like stock options or a way of bonus payments to pay at capital gains rates instead of marginal rates of 35%.

Fuck all you idiots.

[MannyIsGod]

:lmao

[DUNCANownsKOBE]

Oh cool another thread where Wild Cobra pretends to know something about finance.

[MannyIsGod]

oh cool another thread where wild cobra pretends to know something about anything.

fyp

[ElNono]

I just looked into the insider trading activity of the company.


Oh cool another thread where Wild Cobra pretends to know something about finance.

:rollin

[SnakeBoy]

OMG...

I just looked into the insider trading activity of the company.

ElNoKnow...

Shame on you, bringing this smear campaign story without verifying the facts.

Almost all these sales were acquired and sold the same day. That means, these were something like stock options or a way of bonus payments to pay at capital gains rates instead of marginal rates of 35%.
Fuck all you idiots.

No I don't think that's the case. As I recall, they did a secondary stock offering and along with that they moved up the date at which they could sell their shares and then they cashed out. That doesn't mean it was insider trading but it is enough to make you go hmmm.

[Wild Cobra]

No I don't think that's the case. As I recall, they did a secondary stock offering and along with that they moved up the date at which they could sell their shares and then they cashed out. That doesn't mean it was insider trading but it is enough to make you go hmmm.
Sure, they will to whatever they can withing the law. That's to be expected. However, I looked at three of those names that ElNoKnow's link listed, and every one of them acquired and sold the stated shares the same day. These are not shares that they were holding and knew the price was dropping, so they sold. This is also a long term pattern, for the entire history of transactions shown.

When I was with a company that had a stock purchase program, every time, I sold the same day I acquired the shares.

Again. It's not like these people had thousands of shares they were holding, and sold because they were seeing a future drop. I think these records went back two years, and the acquire and sell same day was a the norm. Not a recent development. All the major sales were acquired the same day. In that regard, there is zero fishiness, and ElNoKnow is seriously lame for posting a flat out hit piece without a simple verification of relevant fact.

ElNoKnow...

You should stop reading propaganda rags. They rot your brain.

[mouse]

I wonder how the world ever survived before wall st.

[Th'Pusher]

Sure, they will to whatever they can withing the law. That's to be expected. However, I looked at three of those names that ElNoKnow's link listed, and every one of them acquired and sold the stated shares the same day. These are not shares that they were holding and knew the price was dropping, so they sold. This is also a long term pattern, for the entire history of transactions shown.

When I was with a company that had a stock purchase program, every time, I sold the same day I acquired the shares.

Again. It's not like these people had thousands of shares they were holding, and sold because they were seeing a future drop. I think these records went back two years, and the acquire and sell same day was a the norm. Not a recent development. All the major sales were acquired the same day. In that regard, there is zero fishiness, and ElNoKnow is seriously lame for posting a flat out hit piece without a simple verification of relevant fact.

ElNoKnow...

You should stop reading propaganda rags. They rot your brain.

They had an option to purchase the stock. There is no reason to purchase the stock until you are ready to sell or your options are going to expire. The fact that they purchased and sold them on the same day has absolutely nothing to do with the charge of insider trading.

[ElNono]

Again. It's not like these people had thousands of shares they were holding, and sold because they were seeing a future drop. I think these records went back two years, and the acquire and sell same day was a the norm. Not a recent development. All the major sales were acquired the same day. In that regard, there is zero fishiness, and ElNoKnow is seriously lame for posting a flat out hit piece without a simple verification of relevant fact.

ElNoKnow...

You should stop reading propaganda rags. They rot your brain.

Tell us more about how you "looked into the insider trading activity of the company"... crofl

[clambake]

Tell us more about how you "looked into the insider trading activity of the company"... crofl

doesn't everyone publicize their insider trading? :p:

[ElNono]

doesn't everyone publicize their insider trading? :p:

The FTC would like to have a word with Cobra... :lol

[ElNono]

Now they're getting punched from every angle...

EA files lawsuit against Zynga for copyright infringement (http://www.theverge.com/gaming/2012/8/3/3217953/ea-files-lawsuit-against-zynga-for-copyright-infringement)

Includes some additional info about the insider trading allegation (and apparently now, lawsuit).

[coyotes_geek]

Tell us more about how you "looked into the insider trading activity of the company"... crofl

I'm normally not one to stick up for WC, but it's not that hard, TBH.

http://finance.yahoo.com/q/it?s=ZNGA+Insider+Transactions

[ElNono]

It's not that hard, TBH.

http://finance.yahoo.com/q/it?s=ZNGA+Insider+Transactions

Those are insider transactions. Nothing wrong with them. Per SEC Rule 10b5-1, those transactions need to be done at very specific times, otherwise they're illegal (what is commonly known as "insider trading").

[coyotes_geek]

Those are insider transactions. Nothing wrong with them. Per SEC Rule 10b5-1, those transactions need to be done at very specific times, otherwise they're illegal (what is commonly known as "insider trading").

Right. And those transactions were done at very specific times and properly documented through SEC filings. Those following the stock knew about the transactions, or at least they all had the opportunity to know about the transactions, on the day they occurred. In fact news of the sale (http://online.wsj.com/article/SB10001424052702304724404577299372042231462.html) broke over a week before the transactions actually took place.
So I'm not really seeing the problem here.

[ElNono]

Right. And those transactions were done at very specific times and properly documented through SEC filings. Those following the stock knew about the transactions, or at least they all had the opportunity to know about the transactions, on the day they occurred. In fact news of the sale (http://online.wsj.com/article/SB10001424052702304724404577299372042231462.html) broke over a week before the transactions actually took place.
So I'm not really seeing the problem here.

When Zynga went public in December of 2011 at $10 a share, employees and early investors were "locked up," banned from selling their shares until May 28th, 2012. But a select group of insiders got underwriters Morgan Stanley and Goldman Sachs to waive that restriction, allowing them to sell an additional $515 million worth of shares on April 3rd at $12 a pop.

This arrangement is at the heart of an insider trading lawsuit (http://assets.sbnation.com/assets/1267398/Zynga_Complaint_Filed.pdf) filed yesterday in San Francisco by the law firm Newman Ferrara. "Zynga's regular employees were still locked up from selling their shares. But the guys at the top, who saw what was coming down the pipe, got to cash out," said Ferrara attorney Roy Shimon. By the time the original lockup expired on May 28th, the company's share price had dropped to $6. After last week's earnings report it dropped to just over $3.

[ElNono]

That's the allegation. I'm not saying wrongdoing took place, just that it looks fishy as fuck.

[coyotes_geek]

That's the allegation. I'm not saying wrongdoing took place, just that it looks fishy as fuck.

Oh I definitely agree that it looks bad. I'm just not seeing anything unusual to other stocks that have IPO'd, let alone anything illegal.

[boutons_deux]

And Congress still not completely, clearly forbidden from insider trading

Congress closes loophole in stock trading law after CNN report

members of Congress thought they voted for earlier this year wasn't exactly as advertised. The STOCK Act requires that any trades of $1,000 or more made on or after July 3 have to be reported to the House and Senate within 45 days. But the House and Senate came out with two completely different interpretations of that rule.

http://www.cnn.com/2012/08/02/politics/stock-act-loophole/index.html

hmm, that's the REPUG-dominated House that voted as if family members could still be insider traders. :lol

Did they decide/define what a "lobbyist" and forbid Congress from passing insider info to them? :lol Very easy for a lobbyist to trade on Congressional insider trading and pass profits back to the Congressman.

[ElNono]

Oh I definitely agree that it looks bad. I'm just not seeing anything unusual to other stocks that have IPO'd, let alone anything illegal.

On a personal note, I think this is how companies are gutted. Management looking only after themselves while the company and it's employees rot and die. Wouldn't be surprised to see Zynga bought out by a big fish for pennies on the dollar after this.

[velik_m]

More trouble for Zynga:

http://techcrunch.com/2012/08/03/electronic-arts-sues-zynga-says-the-ville-is-an-unmistakable-copy-of-the-sims/

http://www.scribd.com/doc/101954002/EA-v-Zynga-Complaint-Final

[Wild Cobra]

They had an option to purchase the stock. There is no reason to purchase the stock until you are ready to sell or your options are going to expire. The fact that they purchased and sold them on the same day has absolutely nothing to do with the charge of insider trading.
True, but it makes the charge meaningless when there are other plausible reasons. To make such attacks with only circumstantial evidence is still an unethical act in itself.

[Wild Cobra]

Tell us more about how you "looked into the insider trading activity of the company"... crofl
Tell us more about how you "looked into the insider trading activity of the company"... crofl

It works both ways.

There is no evidence that this is unethical or illegal insider trading that you can show.

Again, this is the normal course of action that the three insiders I looked up acquired and sold the stocks the same day.

Do you understand stand what I'm saying? For the history that these online records cover...

Why are you all so hard headed?

There are multiple acquire and sell activities for each of them. How can you take a two year pattern and then turn around and claim the last trades were wrong?

[Wild Cobra]

That's the allegation. I'm not saying wrongdoing took place, just that it looks fishy as fuck.
Bullshit.

A two year pattern with multiple identical type transactions does not make this last quarter's transaction fishy.

It's all in your mind.

You should go see a shrink.

[Wild Cobra]

When Zynga went public in December of 2011 at $10 a share, employees and early investors were "locked up," banned from selling their shares until May 28th, 2012. But a select group of insiders got underwriters Morgan Stanley and Goldman Sachs to waive that restriction, allowing them to sell an additional $515 million worth of shares on April 3rd at $12 a pop.

This arrangement is at the heart of an insider trading lawsuit (http://assets.sbnation.com/assets/1267398/Zynga_Complaint_Filed.pdf) filed yesterday in San Francisco by the law firm Newman Ferrara. "Zynga's regular employees were still locked up from selling their shares. But the guys at the top, who saw what was coming down the pipe, got to cash out," said Ferrara attorney Roy Shimon. By the time the original lockup expired on May 28th, the company's share price had dropped to $6. After last week's earnings report it dropped to just over $3.
They guys at the top were selling shares even before that April time. They were different classes of shares. They were acquiring and selling in December 2011 as well.

You should stop quoting/linking other people's propaganda. Go to any investment site, look at the stock ticker, then look at what the site shows for insider transactions.

Look at the patterns.

My god... Your ignorance is really showing bad.

[ElNono]

A two year pattern with multiple identical type transactions does not make this last quarter's transaction fishy.

What two year pattern? Zynga went public in December of last year... :lmao


They guys at the top were selling shares even before that time. They were different classes of shares.

You should stop quoting/linking other people's propaganda.

Those were the rules of the IPO. I didn't made them up, nor the report.

lol dumb as a rock
lol propaganda

[Wild Cobra]

What two year pattern? Zynga went public in December of last year... :lmao



Those were the rules of the IPO. I didn't made them up, nor the report.

lol dumb as a rock
lol propaganda
You're right, the online site I went to keeps records two years back. There are still multiple acquisitions and sales for those insiders from December to July.

[SnakeBoy]

They guys at the top were selling shares even before that April time.

One trade 2 weeks earlier.

http://www.insidercow.com/history/company.jsp?company=znga

[Wild Cobra]

One trade 2 weeks earlier.

http://www.insidercow.com/history/company.jsp?company=znga
Stop just looking at the propaganda. They were selling in December also. You guys make it sound as if there was only one day they unloaded.

Here are the dates of acquisitions and sales:

12/15/11
1/1/12
1/9/12
1/15/12
2/2/12
2/9/12
3/9/12
3/15/12
3/30/12
4/3/12
4/9/12
4/20/12
5/2/12
5/9/12
5/20/12
6/9/12
6/30/12
7/2/12
7/9/12
7/15/12
7/25/12

Don't believe me, don't believe the propaganda rags.

Look it up yourself dammit.

[CosmicCowboy]

I don't see why it's such a big deal that these guys sold stock. It's typical on startups to compensate talent with a shitload of stock options. It goes public, they get their big payday by cashing in some of their options. The thing to watch is not that they are selling stock, but what percentage of their holdings they are selling. If it's 10% that's just normal diversification. If it's 90% it's reasonable to ask yourself why they have lost faith in the earning power of farmville, words with friends, etc. I'm sure having Facebook stock take suck a public shit hasn't helped them.

[ElNono]

It looks fishy as hell because they negotiated an early release on the stock lock-out in March, to sell stock in April, before the quarter earnings, only benefiting themselves, and excluding all non-executive employees and public shareholders, which took it in the ass.

Whether there's wrongdoing or not, the court will decide, but it certainly looks like shit.

[CosmicCowboy]

It looks fishy as hell because they negotiated an early release on the stock lock-out in March, to sell stock in April, before the quarter earnings, only benefiting themselves, and excluding all non-executive employees and public shareholders, which took it in the ass.

Whether there's wrongdoing or not, the court will decide, but it certainly looks like shit.

I dunno...the stock opened really strong making it look like the underwriters underestimated demand. They decided to offer more stock and it got snapped up by willing buyers. I don't see the foul here. It looks to me like it was the debacle at Facebook that infected Zynga stock, not malfeasance on Zynga's part.

[Wild Cobra]

I don't see why it's such a big deal that these guys sold stock. It's typical on startups to compensate talent with a shitload of stock options. It goes public, they get their big payday by cashing in some of their options. The thing to watch is not that they are selling stock, but what percentage of their holdings they are selling. If it's 10% that's just normal diversification. If it's 90% it's reasonable to ask yourself why they have lost faith in the earning power of farmville, words with friends, etc. I'm sure having Facebook stock take suck a public shit hasn't helped them.

That's another thing. In many of these sales, they didn't sell all they acquired. They kept some.

[TeyshaBlue]

It aint getting any better over there in ZyngaVille.

http://www.macworld.com/article/1168018/ea_files_copyright_suit_against_zynga_over_the_sim s_social.html

[CosmicCowboy]

Do you guys understand that when stock options vest they immediately owe taxes on it even if they don't sell, right? If they don't have the cash they HAVE to sell some stock to satisfy uncle sam.

[Wild Cobra]

Do you guys understand that when stock options vest they immediately owe taxes on it even if they don't sell, right? If they don't have the cash they HAVE to sell some stock to satisfy uncle sam.
The middle to far left won't listen to facts. They will take any tiny thread they can try to tug on, to use their hate of on the rich, right, christian, etc.

[ElNono]

It aint getting any better over there in ZyngaVille.

http://www.macworld.com/article/1168018/ea_files_copyright_suit_against_zynga_over_the_sim s_social.html

It's only the third time it's been posted in this thread... :lol

[TeyshaBlue]

It's only the third time it's been posted in this thread... :lol

Unlike you, I woke up this morning and made a conscious decision to like women and bang chicks. I been busy, boy.:lol

[TeyshaBlue]

When I'm done, I'm gonna post a link about EA suing Zynga!

[ElNono]

I dunno...the stock opened really strong making it look like the underwriters underestimated demand. They decided to offer more stock and it got snapped up by willing buyers. I don't see the foul here. It looks to me like it was the debacle at Facebook that infected Zynga stock, not malfeasance on Zynga's part.

But these same executives were touting how well the company was doing, only to show a month later (after they dumped their stock options) the company was actually sucking. At least that's what the lawsuit alleges.


Do you guys understand that when stock options vest they immediately owe taxes on it even if they don't sell, right? If they don't have the cash they HAVE to sell some stock to satisfy uncle sam.

The stock didn't vest until May. They sought (and received - executives only) a waiver to sell earlier. I doubt they dumped half a billion dollars in stock out of mere tax concerns.

[ElNono]

Unlike you, I woke up this morning and made a conscious decision to like women and bang chicks. I been busy, boy.:lol

:lol

[TDMVPDPOY]

sell out b4 making annual announcement...i see...typical racket

[Wild Cobra]

sell out b4 making annual announcement...i see...typical racket
Am I to understand that, that by extension of your logic, insiders can never sell? After all, there are quarterly reports...

[ElNono]

Am I to understand that, that by extension of your logic, insiders can never sell? After all, there are quarterly reports...

You didn't follow his logic well.... at all.

Employees are "insiders" too, and they were not allowed to sell until after the quarterly report.

[Wild Cobra]

You didn't follow his logic well.... at all.

Employees are "insiders" too, and they were not allowed to sell until after the quarterly report.

Riddle me this.

How many stocks from the IPO offering that the insiders bought during the offering did the insiders sell before the end of quarter?

[ElNono]

Riddle me this.

How many stocks from the IPO offering that the insiders bought during the offering did the insiders sell before the end of quarter?

What does that matter? They dumped the secondary offering stocks they received for $12 a pop and made upwards of $500 million under a special arrangement they made with the underwriters, that allowed only the executives to cash in a month before the quarterly results, while every other "insider" or not was forbidden to do so. When the quarterly report came in, turns out the company was hurting and the stock was worth only $3 a pop.

The underwriters got paid $15 million in fees for the secondary offering + granted 6+ million shares of stock.

Was there any wrongdoing? We'll find out. But sure as hell looks like some people were desperately trying to cash out before the quarterly report.

[Wild Cobra]

What does that matter? They dumped the secondary offering stocks they received for $12 a pop and made upwards of $500 million under a special arrangement they made with the underwriters, that allowed only the executives to cash in a month before the quarterly results, while every other "insider" or not was forbidden to do so. When the quarterly report came in, turns out the company was hurting and the stock was worth only $3 a pop.

The underwriters got paid $15 million in fees for the secondary offering + granted 6+ million shares of stock.

Was there any wrongdoing? We'll find out. But sure as hell looks like some people were desperately trying to cash out before the quarterly report.
It matters because its a different set of rules, your you try to make it out as if they have to follow the same waiting period.

[Wild Cobra]

Another thing.

Who got hurt?

The stock would have likely dropped anyway. IPO's very often take a dive. It's not unusual. An IPO is a high risk investment.

[ElNono]

It matters because its a different set of rules, your you try to make it out as if they have to follow the same waiting period.

They originally had the same exact waiting period, executives and non executives. The requirement was waived by the underwriters under the secondary offering.


Another thing.

Who got hurt?

The stock would have likely dropped anyway. IPO's very often take a dive. It's not unusual. An IPO is a high risk investment.

But that's the point, dumbass. They were allowed to cash out before the stock sunk. The other "insiders" or public were left with semi-worthless paper.

[Wild Cobra]

They originally had the same exact waiting period, executives and non executives. The requirement was waived by the underwriters under the secondary offering.
So?

It still doesn't clear you of bring to this forum a linked story that assumes the worse and spins the worse, for the lemming libtard masses to consume.

I thought you were better than that. Sorry for my mistake.

[ElNono]

It still doesn't clear you of bring to this forum a linked story that assumes the worse and spins the worse, for the lemming libtard masses to consume.

I thought you were better than that. Sorry for my mistake.

What is "assumed and spin" on the story?

Yes, you're mistaken a lot lately.

[Wild Cobra]

What is "assumed and spin" on the story?

Yes, you're mistaken a lot lately.
You need to learn to read between the lines.

[ElNono]

You need to learn to read between the lines.

So it's all in your head :lmao

[Wild Cobra]

So it's all in your head :lmao
No, in yours.

You were towing the line, not me. I mentioned the read between the lines to point out you need to understand the difference between what is true and not by parsing what is written. Point is, you ran hook line and sinker with the "fishy" crap. You didn't verify. This is what was intended for the reader to glean between the lines without them lying. You need to go at least two steps farther. What is factually said, and to verify what is implied. They let their lemming readers like you, read between the lines what is implied, and let you do the slander rather than them.

I just can't think everything is cozy with this... reeks of insider trading... you can't tell me they didn't know how the company was performing...
You already made up your mind.

[ElNono]

No, in yours.


What is "assumed and spin" on the story?

Yes, you're mistaken a lot lately.



You already made up your mind.

lol chastising anybody for having an opinion
lol authoritarian

[mouse]

A point some of you are not addressing is the fact that the investors that had the heads up on the stock going down could have easily warned others but they kept it a secret. I'm sure if all of us bought SpursTalk stocks at 20 dollars a share and found out it was worth only 2.00 dollars a share and only posters with 5,000 post count were notified a month in advanced some of you would be pissed.

[CosmicCowboy]

I sold Spurstalk at 22 bitch.