2U Inc (TWOU)

[MiamiGent]

TWOU Lock-ups expire tomorrow (9/24)*- shorts up 23% last 20 days.
*"..substantially all (shares) will be available for sale.." (latest 10Q)

Top ten institutions and top ten funds hold 13.331M and 3.114M shares, respectively. All twenty are under 10% so they can start unloading tomorrow without declaring their intent in advance.

TWOU CEO Paucet is wasting no time, filing to unload 80,000 shares from 9/25 on.
CTO Kenigsberg also filed to sell 80,400 shares from 9/25 on.
CMO Rinehart filed to sell 64,800 shares from 9/26 on.

In April, company insiders unloaded 1.054M shares, the first opportunity to sell some.

Clearly, insiders want their "reward" now.

The chart has lost major support (50 and 20MA- there is no 200 as a recent IPO) despite a flurry of puff pieces last week attempting to stem the sharp downturn, as expiry neared.
http://stockcharts.com/h-sc/ui?s=TWOU

Daily volume is declining, about 40% yesterday from 20 days ago and well below the 10 and 90 daily average volumes.
The whole broad industry may be suffering in the shadows of the Corinthian meltdown (COCO).

TWOU is a big money loser [2U's net loss this second reporting quarter was -$10.595M versus the first reporting quarter (March 31, 2014) of -8.895M and currently carries $92.02M negative shareholder equity].
"We have incurred significant net losses since inception, and we expect our operating expenses to increase significantly in the foreseeable future." (latest 10Q)


I expect the unloading of shares to continue. My first target is 13.63, next is $13 (the IPO price) and on down (many options were granted at 3.53).


MG


TWOU latest 10Q:
"As of April 30, 2014, we had outstanding 40,212,605 shares of common stock outstanding. Of these shares, substantially all will be available for sale in the public market beginning September 24, 2014 following the expiration of lock-up agreements between the underwriters and our officers, directors, holders of much of our outstanding common stock. The representatives of the underwriters may release these stockholders from their lock-up agreements with the underwriters at any time and without notice, which would allow for earlier sales of shares in the public market."