Selling F5 RSU & ESPP Shares
Last month, I posted an analysis of historical FFIV share pricing data going back to November 2014. I was attempting to understand, historically speaking, whether there had been any advantage to waiting a few extra days to sell ESPP shares once received. I suspected that when hundreds or thousands of F5 employees are offloading their shares on the same day, it might depress prices temporarily, so there might be an advantage to waiting.
I had a few people reach out asking about RSU dates as well, not just ESPP dates, so I ran the numbers for those as well. Here's what I found.
The historical price trend appears consistent. Selling ESPP shares on the 6th trading day after receipt (receipt is on the first trading day in May or November) yielded, on average, a 2% higher price. See figure 1. If you're contributing $25K per year, that's about $500 of additional gain on average. It's not much, but it's something, and it's free.
RSU historical price trends appear similar but not quite as strong. See figure 2. Remember that FFIV RSUs aren't available for sale (due to sell-to-cover tax requirements) until the third trading day of the month. Also, these occur four times a year instead of twice a year, like ESPP shares. Selling RSU shares on the 4th day after receipt (equivalent to the 6th ESPP trading day) yielded about 1.2% additional value, on average. If you're dealing with, let's say, $50K of RSUs each year, then that's about $600 of additional gain on average.
How did FFIV do in the most recent ESPP/RSU selling period? The historical pattern repeated. See figure 3. It dipped on day-1 and day-2, then began to rise on day-3. By day-4 however, the morning after the election, it was overwhelmed by the overall market's response, so it's not a statistically significant data point going forward IMO.
Past performance does not guarantee future results, but on average, this strategy could potentially unlock an extra $1,000-$2,000 per year for typical F5'ers participating in RSU and ESPP periods even when selling upon receipt. For higher earners of RSUs, it could be substantially more.
Knowledge is power!
figure 1. ESPP Closing Share Price Historical Trends
figure 2. RSU Closing Share Price Historical Trends
figure 3. F5 Closing Share Price First 9 Trading Days of Nov 2024
Disclaimer: The information provided in this blog post is for educational and informational purposes only and does not constitute specific financial, tax, or legal advice. All investing involves risk, including the potential loss of principal. Market data and statistics cited are believed to be accurate as of the date of publication, but are subject to change. Please consult with a qualified financial professional to discuss your individual circumstances and risk tolerance before making any investment decisions.