Lockup Could Swing Switch Lower

The 180-day lockup period for Switch (SWCH) ends on April 16, 2018. When this six-month period concludes, the company’s pre-IPO shareholders and insiders will have the ability to sell large blocks of currently restricted shares. The potential for an increase in the volume of shares traded on the secondary market could negatively impact the stock price of SWCH in the short term.

(Source: S-1/A)

Currently SWCH trades in the $13 to $14 range, lower than its IPO price of $17. Shares of Switch have fluctuated over the last six months, but primarily they have declined after reaching a high of $20.03 on November 3, 2017.

Business Overview: Operator of Data Centers in the United States

Switch provides co-location space and other related services to digital media and technology organizations, financial institutions, cloud and managed service providers, telecommunications providers, and government agencies. Currently, the company has three data centers that operate in Nevada and Michigan.

(Source: S-1/A)

In its Source: S-1/A, Switch notes that it considers its data centers as the “world’s most reliable, secure, resilient, and sustainable data centers.” These data centers are powered solely on renewable energy and exceed industry averages for cooling efficiency, which is a major factor in maintaining data centers. Two of its centers are the only facilities in the world that have received multiple Tier IV certifications, and the company is working toward even higher standards to go beyond the current certification limits. Switch has a customer base of more than 800 clients, which include many global players.