Ride-hailing giant Uber failed to take off like fellow tech peers when it started trading on the New York Stock Exchange. RT’s Boom Bust digs into the reasons for the disappointing results and what they mean for Uber’s future.
The first day as a publicly traded company did not bring what Uber and its investors hoped for. The firm started trading on Friday at $42, below its $45 IPO price, and closed even lower at $41.57.
Speaking to RT, the director of options at Simpler Trading, Danielle Shay, said the IPO debut may not be that bad for the firm long term, even though tech stocks normally surge after IPOs. However, a similar but smaller ride-hailing app might have gotten in its way and affected its market performance, she said.
“Honestly, I think that it has to do with Lyft. Lyft was so hyped up, Lyft was the one that came in first out of the two companies,” Shay explained, adding that the firm has been in the news for several weeks and is trading lower. “I think that it really tainted Uber’s IPO.”
The US-China trade war and the Uber drivers strike might have also affected the debut, but the price is still expected to level out and the company should become more attractive for investors, the analyst believes.
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