Tuesday was not a good day for tech stocks, and it was a particularly lousy day for content delivery network (CDN) operator Cloudflare (NET 2.14%). On the back of a broad sell-off in tech stocks on renewed inflation fears plus a big insider share sale, the company's stock price was down by nearly 7% in late-session trading.
Hardly for the first time this year, tech stocks as a group were taking a real pounding on Tuesday. Inflation fears trigger worries about higher interest rates. In turn, higher interest rates make "safe" assets such as bonds more attractive, and riskier plays less so. By their nature, tech stocks tend to be lumped into the "more risky" category.
But that wasn't the only dynamic pushing Cloudflare's stock earthward on the day. Streetinsider.com reported that CEO Matthew Prince filed paperwork to sell 471,456 shares of the company, citing information from Goldman Sachs -- one of the lead underwriters of Cloudflare's IPO.
The date of the sale was apparently last Friday, Sept. 9, and the total take from the transaction was roughly $31 million.
That one-two punch came just after a stretch when Cloudflare stock was actually doing relatively well.
It was doing a better job of holding its value than other tech titles, thanks in no small part to the excellent second-quarter results it published last month. The company notched an all-time record for large customer additions, with 212 "adds" during the period. This helped propel revenue 54% higher on a year-over-year basis, and deliver beats on both that line item and net income. It also gave Cloudflare the confidence to raise its guidance.