Uber Ends First Day of Trading On Bad Note

Well Uber’s debut in the stock market came and went and the result was not good.

The ride hailing company made its long awaited debut on the NYSE at $42 a share on Friday under the ticker symbol “UBER.”

By the end of the day, shares were down nearly 8% and closed with a market cap of $69.7 billion.

When news first surfaced that Uber would be going public, the valuation the company had been reportedly seeking was $120 billion, almost double what the company achieved now.

It was also a rocky day of trading on Friday which may have impacted how Uber did. The Dow Jones Industrial Average had fallen over 300 points as traders digested President Trump’s latest tweet about the trade war with China.
Uber’s chief financial officer, Nelson Chai, said that Friday “was a tough day” on the market in an interview on CNBC.

“I don’t think that we’re smart enough to try to judge the market. … We weren’t optimizing to have the best opening price or the opening day. We’re really looking for how the stock continues to trade over time and that’s what we’re building for,” he added when he was asked about whether the company should have delayed the IPO.

CEO Dara Khosrowshahi has remarked about the comparison to Lyft and said, “It’s a fair comparison at the wrong time. So a lot of private companies now are holding off much longer before they go public. We are much bigger, much more mature as a company as we go public, and if you do look at the growth rates, our audience is growing 33% on a year-on-year basis, transactions are growing 36%. To be able to grow transactions 36% on a $50 billion base is pretty incredible, and we hope to keep it going.”

If Khosrowshahi can keep Uber’s valuation above $120 billion for 90 consecutive days once it goes public, he will win net stock bonuses topping $100 million.

He told CNBC, “I’m here to stay. I’m here to build a big company. That compensation term is not about a single day, it’s about what value you create over 10 years, and over 10 years, absolutely I expect to get there.”

Uber’s debut in the market was the worst for a company of its size.

Disclaimer: We have no position in Uber Technologies Inc. (NYSE: UBER) and have not been compensated for this article.