Twilio Squeezed Higher Ahead Of Friday's Lock-Up Expiration

Twilio Inc TWLO, the up-and-down IPO of 2016, has seen a large run up in Thursday's trading session. From a technical standpoint, it has been a wild ride for shareholders while their shares were restricted.

After debuting last June, Twilio's stock bottomed at $23.66 and skyrocketed to $70.96 in September. Its fall from grace took the issue to within a few dollars of its all-time low when it bottomed on January 3 at $25.98.

There are two considerations to take into account when evaluating whether or not the largess of shares may or may not come for sale in the open market.

Thursday's 7.4 percent surge is being attributed to the large, 29.7 percent short interest in Twilio shares prior to a 31 million share lockup expiration tomorrow. Since its IPO, Twilio has seen 67 million shares unlocked for sale. The lockup expirations have occurred in three different blocks:

• December 20 - 31 million shares
• January 19 - 5 million shares
• February 10 - 31 million shares

While the issue may have been overvalued at $70 and undervalued in the $20s and $30s, long-term shareholders just may value the issue at somewhere in the middle.

Either way, combining the past momentum and large short interest in Twilio, it'll be interesting to see the action in Friday's trading session.

Joel Elconin contributed to this report.