Shares of cloud-computing specialist Fastly (NYSE:FSLY) jumped on Wednesday, rising as much as 16.2%. As of 11:51 a.m. EDT, the stock was up 11.8%.
There didn't seem to be any specific news that sent shares higher at market open. But shares have notably been volatile since the stock's initial public offering, making moves like this fairly routine.
In addition, the stock's post-IPO lockup expiration ends today, giving pre-IPO shareholders a chance to sell. The stock's move today could have to do with trading surrounding the event.
With one investment firm gobbling up shares of Fastly following the company's IPO in May, the stock's float (shares outstanding available to trade) was reduced substantially, resulting in more volatile trading. Wednesday's move, therefore, isn't out of the norm for Fastly.
Further, volatility may be higher on Wednesday as traders cover short positions. Traders may have been betting on a falling stock price leading up to the lockup expiration as the market worried about potential insider selling.
Investors should remain focused on Fastly's underlying business. The company reported strong third-quarter results last week with $50 million in revenue, up 35% year over year. The quarter was powered by new customer wins and increased spend from existing customers.
Management lifted its expectations for full-year revenue, guiding for total revenue between $194 million and $198 million, up from a previous forecast for $191 million to $195 million.