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TEAM Lock Up Expiration Provides Shorting Opportunity

|Includes: Atlassian (TEAM)

Summary

  • Lockup period expires in early June; an array of insiders hold ~155M shares and could be ready to take profits.

Atlassian Corporation (NASDAQ: TEAM) - Sell or Short Recommendation - $21.75 PT

  • Headquartered in Sydney, Australia, Atlassian Corp. designs, creates, licenses and maintains software and hosting services that support team-based collaboration.
  • We previously published on TEAM's IPO and IPO quiet period expiration-both strong opportunities to buy into the company.
  • The IPO lockup period for TEAM expires June 7th; major shareholders will be able to sell some or all of their ~150 million shares of Class B common stock, restricted from trading since the firm's IPO.
  • With just 22 million shares initially offered, if insiders (14 directors and executives, along with Accel Partners) sell even a portion of their holdings, they could push TEAM stock price down considerably.
  • Our firm's research shows abnormal negative returns of 4.2% in the two weeks surrounding many lockup expirations. Significant factors that amplify our short positions often include: strong VC backing, multiple and diverse pre-IPO shareholders, and being a technology company.

Disclosure: I am/we are short TEAM.