After almost two weeks of falling share price, Twitter interim CEO Jack Dorsey has bought some of the stock in a vote of confidence. The 31,627 shares, costing £550,000, add less than 0.10 per cent to Dorsey’s stake in the company.
This vote of confidence from the interim CEO seems to have paid off, with the stock shooting up by nine per cent in Monday trading. That said, it is still at its lowest point ever, trading at $29.50 (£18.93) per share at the time of writing.
Dorsey is not the only Twitter executive buying up shares either. Chief financial officer Anthony Noto was one of the only company executives placing buy orders two weeks ago, and both Peter Currie and Peter Fenton have bought over 7,000 shares each.
One thing the interim CEO failed to mention is the 379,000 shares he has sold since November, with prices much higher than the current share price. The addition of 31,000 shares at £18.93 could be seen as a smart financial move, since Twitter cannot get much lower than the current price.
Dorsey is also preparing to move to a full-time position at Twitter, according to rumours. Square—the payments company he founded—will keep him on as Executive Chairman, allowing another CEO to run the company and file the IPO.
Bringing Dorsey back to Twitter would definitely peak the interest of investors. It may also improve morale at the company, which is low because of the CEO issue.
Considering some of Twitter’s apparent choices for CEO declined, it would seem Dorsey is the best option. Sundar Pichai, who was reportedly high on the list, recently received a promotion to CEO of Google.
Dorsey holds a $600 million (£385 million) stake in Twitter. The company is currently valued at under $20 billion (£12.8 billion), in buyout range for Facebook, Yahoo and Google—although the latter is apparently not interested.