Robinhood Markets Inc (NASDAQ:HOOD) suffered a setback on Thursday morning as the shares sank amid a lessening of ‘memestock’ momentum that sent the shares flying earlier in the week.
In early trading on Wall Street, the retail trading platform tumbled 13.9% to US$60.62, although the shares are still well ahead of the US$38 level they were priced at during the firm’s debut a week ago.
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The sharp drop this morning came after the firm unveiled that around 98mln shares will be sold following the share price surge earlier this week, which saw the stock close at a record high of US$70.39 on Wednesday, almost double its IPO price.
The company said the shares are being sold over time by existing shareholders and that it will not make any proceeds from the sale, however, the recent surge means the selling investors are likely to make a tidy profit.
This week’s rally will also have Robinhood’s management breathing something of a sigh of relief following its IPO flop last week, when the shares made their debut at US$38 only to quickly go into reverse and end their first session at around US$34.82.