Uber isn’t having a good time in 2019. its highly anticipated IPO just got relegated and the first day of trading Friday of the New York Stock Exchange is, after all, just a traumatic experience for Uber. Uber net worth was once worth $120 billion and more, now saw the defeat on the day one.
The Trade War Did its Job
When President Donald Trump dropped trade war bombs on the Chinese officials via Twitter, Lyft and Uber continued to be disasters. The business priced its stock at $45, with the valuation of the company at $82.4 billion. By Friday morning, Uber started to trade at about $42 and by the time the market closed, the stock has fallen to 7.6% from the IPO price of $41.57.
The analysts say that this is due to the US-China trade war. The investors are generally nervous because of this war, which puts additional risk on the market. Dan Ives, Wedbush Securities analyst, says that he spoke to many investors and they were all hesitant to buy Uber out of the box.
Due to Lyft being beaten since its IPO, investors are now waiting for the battle to settle, before making the decision.
The Wall Street Reaction
Wall Street analysts were pretty hopeful on Uber, even ahead of its IPO. The influential crowd is unlikely to shift their perspective, even though Uber had a few sluggish days. Ives said that he isn’t worried about the stock turbulence lasting a few days and he adds that he thinks that Uber is still worth $100 billion plus.
He believes that this weakness in shares will not last long, as the core value of the franchise is higher than the current values. As Lyft isn’t able to convince people to jump into the stock 23% lower from the IPO, it’s really hard to grasp how will Uber win this battle and convince people to buy their stock.