Purplebricks’ share price shot up yesterday after the firm issued a statement to the London Stock Exchange confirming what it had said in a tweet.
Yesterday’s announcement said that the company had seen “record monthly valuations and instructions activity in January (as mentioned in a tweet by the Company on 26 January”.
At one stage the shares lifted to 199p – very close to last Friday’s record high of 201p.
They finished up 15.5p at 195p, a rise of 8.45%.
The share price hit the record 201p the day after last Thursday’s tweet – but then fell back after Purplebricks made a first statement to the Stock Exchange late on Friday which said it did not know why the shares moved upwards.
The Financial Times reported that yesterday’s update to the Stock Exchange followed “conversations between the group’s nominated adviser (Nomad), Zeus Capital, and the UK Listing Authority, the securities regulator, according to a person briefed on the situation”.
The FT’s report described Purplebricks as “still-loss making”, and quoted City analyst Anthony Codling, of Jefferies, who said: “It appears to us that while Purplebricks may be disrupting the UK estate agency market, the UKLA will not let its tweets disrupt the workings of the London Stock Exchange.”
The FT reports that the UKLA declined to comment.
The Financial Conduct Authority said yesterday it does not comment on individual companies.
There is some interesting coverage here
The FT story is at https://www.ft.com/content/73d2f63c-e707-11e6-893c-082c54a7f539 although it can only be read by subscribers.
Update: In today’s Daily Mail, a story on their City pages under the headline “Tweet lands online estate agent in a heap of trouble”, Russ Mould, investment director at stockbroker AJ Bell, said the the confusion at Purplebricks in recent days shows “the power of social media and how it needs to be handled carefully”. He went on: “Twitter is clearly not a suitable forum for the dissemination of price-sensitive information.”