Several media quoted people familiar with the matter as saying that Uber, the largest online vehicle in the United States, plans to raise $10 billion, with a price guidance range of $48-55 and a valuation of up to $100 billion, which is less than the expected $120 billion. Competitor Lyft, or Chengqian, fell more than 10% on Wednesday, dropping nearly 33% from its record high.
The original article was first published at 09:08 on April 10, and now updates the latest news of Uber valuation and competitor Lyft share price.
On Wednesday, April 10, Beijing Time, Reuters quoted people familiar with the matter as saying that Uber, the largest U.S. online car giant in the market, will issue about $10 billion in shares through its initial public offering (IPO), and will formally submit its application on Thursday, US East Time.
Uber will launch an investor roadshow within a week of April 29 to enable the company to determine the IPO offering price, the report said. If all goes well, the company will be listed on the New York Stock Exchange in early May.
Uber is looking for a valuation of $90 billion to $100 billion, given the poor performance of rival Lyfts share price after its IPO in late March. Although higher than the companys last round of private equity last year, the valuation of $76 billion, but lower than the market generally expected. Morgan Stanley and Goldman Sachs, the main underwriters of Ubers IPO, said last year that Ubers IPO valuation could be as high as $120 billion.
On April 10, the Wall Street Journal also cited people familiar with the matter to confirm that Uber recently provided investors with convertible bonds with a document setting the range of potential IPO issuance prices between $48 and $55, equivalent to a valuation of $90 billion to $100 billion; when the road show for investors starts in a few weeks, the range of issuance price guidelines may narrow or change, and Uber is likely to be in the second week of May. City.
The report said that the lower limit of the pricing range was surprisingly lower than the $48.77 price set by the last private equity round. In late March, Uber issued a batch of convertible bonds to buy Middle Eastern rival Careem Networks for $3.1 billion at a convertible price of $55. Some investors thought that $55 would be the lower limit of future IPO price range.
According to Bloomberg, Uber plans to raise $10 billion in its IPO, which is expected to become the largest U.S. IPO case this year and rank among the top 10 IPOs in history. Data from Diroki also show that Uber is likely to be one of the largest technology IPOs to date. By contrast, Lyft, the second largest U.S. company in the market, raised $2.3 billion.
One of the reasons for Ubers conservative attitude is the poor performance of Lyft, a competitor who rushed to market as the first share of the U.S. online car market. Uber executives and underwriters want to avoid Lyfts dilemma, and conservative pricing will help the stock price rise after the initial listing in order to attract more long-term investors, according to people familiar with the situation.
Wall Street has mentioned that technology Unicorn Lyft was listed on the Nasdaq Stock Exchange on March 29, surpassing Uber to become the first stock in the United States. Because of the popularity of investors during the roadshow, Lyft raised the issue price guidance interval once before listing. The final set price of $72 is not only at the upper limit of the guidance interval, but also significantly higher than the first round guidance price of $62-68.
On the first day of the IPO, Lyft opened at $87.24, up 21.17% from $72, with a market capitalization of $27.3 billion, up 23% and hitting a 52-week high of $88.60. The first day ended up 8.74% at $78.29. According to CNBC statistics, Lyfts first day trading volume exceeded 70 million shares, becoming the first U.S. stock trading volume on that day.
But the day after the IPO, Lyft not only broke, but also fell directly into the technology bear market. The lowest of the day was $67.78, a 13.4% daily decline, which was 5.9% lower than the $72 issue price. The final price fell 11.85% to $69.01, a 22% drop from the post-market peak. Bloomberg commented at the time that Lyft fell sharply the next day, which was not good news for Uber, which was about to launch its listing.
On Wednesday, April 10, Lyft fell 11.4% in the day, hitting a 52-week low of $59.75. It was also the first time since listing that Lyft had fallen below $60 integer, 17% from the IPO price and 32.6% from the 52-week high. Within two weeks of listing, Lyft had fallen deeper and deeper in the technical bear market. Ultimately, Lyft fell 10.85% to $6.12, with a market value of less than $17.4 billion.
CNBC, the financial media, quoted New York University professor Aswath Damodaran as saying that Lyft is still overvalued, with a reasonable share price close to $59 or a valuation of $15 billion. He believes that both Lyft taxi users and drivers lack the stickiness to the platform, which is also the fundamental defect of the shared travel business model.
2019 is the big year for the technology unicorn to go public in the United States. The market originally expected this years IPO financing scale to reach a new high. Due to the disadvantage of Lyft, many well-known companies that are going to be listed have begun to take the initiative to reduce the valuation level.
Wall Street has mentioned that Pinterest, an American photo social networking site that is expected to go public next week, will set its IPO price range between $15 and $17, with a maximum valuation of $11.3 billion, lower than the companys valuation of $12 billion two years ago. The last round of private equity in 2017 was $21.54, representing a 21% discount of $17 (the upper limit of the issuance guidance price), which could cause dissatisfaction among late-stage venture investors.
Source: Editor-in-Charge of Wall Street: Yao Liwei_NT6056