Shortly after 10:00 a.m. Wednesday morning, shares of Facebook Inc. (FB) began to climb to an intra-day high of more than $48, up from around $46.50. The company’s CFO sold more than 900,000 shares of stock on Tuesday, but that should have sent the shares down, not up.
AOL Inc. (AOL) posted a new high of $45.30 on no news, Zynga Inc. (ZNGA) is up nearly 7.5%, and LinkedIn Corp. (LNKD) is up more than 4%. Twitter Inc. (TWTR), alas, is up a more anemic 1%. None of these social media companies really had any news today, so what gives?
The first thing that comes to mind is that these five stocks, with the possible exception of LinkedIn, are momentum stocks. As indexes move higher, these stocks get the benefit of the doubt and often jump more than the indexes do. The Nasdaq Composite is up about 0.75% in late-afternoon trading, less than any of the five stocks.
Twitter shares are lagging a bit as short sellers are able today to begin borrowing shares and that has kept the share price increase fairly small.
Zynga was the first of these stocks to pop, jumping about 2.3% almost immediately after the market opened and peaking in the mid-afternoon. But there’s no other apparent reason for the stock’s jump today.
AOL stock is at its high since the company’s spin-off from Time Warner Inc. (TWX) in 2009, and the stock is up more than 16% since the company reported earnings on November 5th. Except for Zynga, which is up less than 1% since AOL reported results, the other stocks have all lost value, with Twitter down the most (8%), LinkedIn down nearly 3%, and Facebook down about 0.5%.
It could be that Facebook and the rest of this group are being pulled along by AOL, and in fact, that is probably what’s happening. The irony of what was once a dial-up company leading the social media sector to good gains is almost too sweet to overlook.
Shares of AOL are up about 4.4% at $45.14 in a 52-week range of $29.16 to $45.30.
ALSO READ: States with the Cheapest Gas
Facebook’s shares are up about 3% at $47.98 in a 52-week range of $19.93 to $54.83.
Zynga’s shares are up about 7.3% at $3.77 in a 52-week range of $2.10 to $4.05.
Shares of LinkedIn are up about 4.5% at $218.64 in a range of $95.63 to $257.56.
Twitter’s shares are up nearly 1.5% at $42.51 in a post-IPO range of $39.40 to $50.09.