Uber did not have a great day at its IPO debut in the New York Stock Exchange. It is best to say that Uber’s initial public offering did not go as planned, and the investors, bankers, executives and the people who are paying close attention to Uber’s first day at the stock markets are not impressed by the company’s performance. Uber has debuted on the New York Stock Exchange below its initial public offering price.
The ride-hailing giant which was traded under the name “UBER” was previously valued at $72 billion by venture capitalist firms, and the company priced its shares at $45 apiece which meant that the valuation of the company would rise to $82.4 billion on Thursday. Unfortunately, the company started its trading on the NYSE bourse this morning at $42 apiece, and it closed the day at an even lower price of $41.57, which is a drop of 7.6% from its IPO price. This does not bode well for the future of Uber.
Even with the backdrop of this revelation, the IPO was successful enough for Uber. The ride-hailing business now has a whopping figure of $8.1 billion on its balance sheet that it can utilize by investing in its growth and to capture more market share for the company. Investors are hoping that Uber can ideally transform itself into a profitable business, a feat that it has failed to achieve in its almost 8-year history. Uber just lost more than a billion dollars in its latest quarter, and the issue of profitability seems like a distant future for the company, something that might have affected its performance in the stock market on its opening day.
Any analyst who might have expected Uber to go past the valuation of $100 billion at its IPO debut must surely be disappointed by now. And those individuals who made a projection that the valuation of Uber will go past $120 billion are probably feeling utterly dumb right now. Despite the performance of its stocks, Uber has risen to a market capitalization figure that makes it exist as one of the most valuable companies in US history, and it represents a watershed and landmark event for the mobility, tech and the gig economy at large.
Nobody knows where the stocks of Uber will go from here. Lyft who is the competitor of Uber in the ride-hailing market of the US is facing a tough time at the stock market and it has taken quite a hit since it completed its IPO debut in the month of March. The shares of Lyft are currently trading at a higher price than Uber, which is $51 per share and the company has a market capitalization figure of about $14.6 billion. Its stock has been on a nosedive for more than a week now, and the company just reported losses that are north of $1 billion for the first quarter of 2019.