Published: Sun, May 12, 2019
Money | By Ethel Goodwin

Uber Is Going Public & You Can Invest for $45 per Share

Uber Is Going Public & You Can Invest for $45 per Share

Uber's market value shrank by more than $6 billion during the day, from $82 billion. Even Lyft had a bit of a first-day bounce on its IPO day! As of writing, Lyft is trading at just $52.27 from a high of more than $78. While there will be plenty of investors willing to accept short-term losses for long-term gain, Uber and Lyft will have much more competition in the autonomous taxi market than it now has in the ride-share market, including companies like Tesla and Google.

Uber might be even more popular if not for a series of revelations about unsavory behavior that sullied its image and resulted in the ouster of Travis Kalanick as CEO almost two years ago. Uber is by no means the only tech company with a "We do bad things" fund: Facebook recently revealed that it anticipates paying $3 to $5 billion in fines to the FTC, and its chief competitor Lyft noted in a prospectus of its own that it is "currently involved in a number of [lawsuits]" from drivers similarly challenging their contractor status.

After much hype leading up to the largest initial public offering in five years, Uber hit a few potholes on its first day of trading, closing down 8% and reflecting lingering doubts about its future prospects for profitability.

It finally debuted on the New York Stock Exchange today, in the middle of worldwide trade uncertainty and following a massive, global strike by its own drivers. Investors have also been somewhat jittery about Uber, after its rival, Lyft, also had a lackluster IPO. "This would be a template that we could use to help companies with capital formation". But even with Uber's lower share price, its valuation of $76 billion is four times more than Lyft's.

Uber's IPO comes against the backdrop of an increase in trade tensions between the United States and China that has weighed on financial markets and increased investor scepticism about its ability to turn profitable soon enough. Uber has never made a profit and warned investors in its prospectus that it doesn't know if it ever will.

Uber's stock closed Friday's session at $41.57 per share, down 7.6 percent. A recent regulatory filing by Uber showed combined losses from operations of more than $12 billion from 2014 through 2018.

Watching the stock crash from the NYSE trading floor Friday was former CEO Travis Kalanick, who was barred from participating in the opening-bell ceremony by current CEO Khosrowshahi, according to a New York Times report.

Uber has also weathered controversies including revelations of a culture of sexism and bullying at Uber and U.S. Department of Justice investigations.

Despite the volatile market, Khosrowshahi said he did not consider postponing Uber's IPO date.

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