JPMorgan Chase & Co. (NYSE:JPM), the lead banker for GoPro Inc (NASDAQ:GPRO)’s IPO, has given early authorization to donate the shares for the establishment of the Jill & Nicholas Woodman Foundation.
The donated shares have a total value of around $497.5 million. JPMorgan is effectively giving the Woodman’s the green light to bypass the 180 day share lockup following GoPro Inc (NASDAQ:GPRO)’s IPO, and this has spooked investors, despite a lack of information on when the charity will sell the shares.GoPro suffered on Thursday, falling below $80, just days after hitting an historic high of around $90. The stock has more than tripled in value from the offering price of $24 at the IPO in June.
A knock to investor confidence
OptionMonster’s Jon Najarian commented on a spike in puts on GoPro options this week.
“Who knew that this thing was coming unlocked? Who knew that they were going to put another 20 percent on to the float of this stock? JPMorgan,” he said.
“They had tomorrow’s newspaper today,” he said. “They knew that they were going to bring 20-some-odd extra percent to the float. And that’s why the shares are down so hard today.”
Yahoo Finance Senior Editor Mike Santoli said shareholders were rightly wary of the news, but he didn’t see any long-term detriment to the stock.
However he did comment that “it just really tells you both what kind of people run the company, what their priorities seem to be and just how dependent it was on a very scarce float.”
Future prospects
After a huge fall on Thursday, GoPro stocks have rebounded today following the announcement of a merchandising collaboration with Best Buy Co Inc (NYSE:BBY).
“This expansion will provide GoPro Inc (NASDAQ:GPRO) with a significant increase in shelf space from one of our biggest retail partners in North America,” said GoPro Senior Vice President of Intergalactic Sales, Jonathan Harris. “We’re excited to offer our customers a more compelling experience at most Best Buy locations each time they interact with our products in the store.”
The expansion of involvement with Best Buy is an effort to maximize sales of the new Hero4 premium camera, and timed just before holiday season. The announcement has already led to an upturn in share prices after Thursday’s drop.
