Facebook, Inc. (NASDAQ:FB) investors voted overwhelmingly in support of proposals to fire Mark Zuckerberg as chairman and scrap the firm’s share structure
The Facebook shareholder revolt just got bloody.
In a filing on Monday, Facebook revealed how investors voted on a raft of proposals at its annual shareholder meeting last week–and the results underline the unrest among outside investors.
According to an analysis of the results by Open Mic–an organization that works with activist shareholders to improve corporate governance at America’s biggest companies–independent shareholders overwhelmingly backed two proposals to weaken Mark Zuckerberg’s power.
Some 68 percent of ordinary investors, those who are not part of management or the board, want to oust Zuckerberg as chairman and bring in an independent figure to chair Facebook’s board. This was a significant increase on the 51 percent who voted in favor of an almost identical proposal last year.
Shareholders are furious at the way Zuckerberg has handled a series of Facebook scandals, including election interference on the social network in 2016 and the giant Cambridge Analytica data breach last year. They think the company would benefit from an independent chairman holding Zuckerberg and his top team accountable.
Facebook’s share price fell dramatically last year following the Cambridge Analytica disaster, while weaker than expected growth compounded the downturn. The stock has not fully recovered after hitting a high of $217.50 on July 25 last year. Shares plunged 7.5 percent to $164.15 on Monday following news of a potential antitrust investigation.
Furthermore, 83.2 percent of outside shareholders also backed a proposal to scrap Facebook’s dual-class share structure. Currently, Class A shareholders have one vote per share, while Class B shareholders get 10 votes per share. Management and directors control Class B shares.
In fact, Zuckerberg happens to own more than 75 percent of Class B stock, meaning he has roughly 60 percent of the voting power at Facebook. He and colleagues voted down the independent chairman proposal and the dual-class share plans, meaning they were crushed despite the uprising from outside investors. Put another way, if Zuckerberg and his closest allies disagree with shareholders, they always have the trump card.
In a statement sent to Business Insider, Open Mic’s executive director Michael Connor said the results send a clear message to Facebook management. “The results speak for themselves. Mark Zuckerberg and the Facebook board need to listen to the company’s shareholders. Arrogance is not a substitute for good corporate governance,” he said.
“Investors are clearly concerned and want change,” added Jonas Kron, who runs activist shareholder Trillium Asset Management, which put forward the call for an independent chairman. “This level of support is rarely seen in shareholder proposals.”
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 177.83.
The projected lower bound is: 157.29.
The projected closing price is: 167.56.
A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 25 white candles and 24 black candles for a net of 1 white candles.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 18.3906. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a sell 27 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 33.38. This is not a topping or bottoming area. However, the RSI just crossed above 30 from a bottoming formation. This is a bullish sign. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 0 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -224.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 6 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 19 period(s) ago.
Rex Takasugi – TD Profile
FACEBOOK INC A closed up 3.350 at 167.500. Volume was 100% below average (consolidating) and Bollinger Bands were 13% wider than normal.
Open High Low Close Volume___
163.710 168.280 160.840 167.500 653
Short Term: Oversold
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 179.07 180.98 161.33
Volatility: 54 37 42
Volume: 14,580,248 15,758,009 21,923,046
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
FACEBOOK INC A is currently 3.8% above its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of FB.O (mildly bearish). Our trend forecasting oscillators are currently bearish on FB.O and have had this outlook for the last 11 periods.