Lyft Finally Starts Trading And Ends Day on Modest Note

06:34 03/31/2019

The pink mustache has entered the building. Lyft LYFT  shares made their trading debut this past Friday but ended the day on a modest note.

While many anticipated this IPO and are seeing dollar signs ahead, some are not that convinced Lyft has what it takes to deliver the big profits.

According to Ken Fisher of USA TODAY, shares of Lyft may be 'probably overpriced.' Tim Worstall of Forbes said in a headline that Lyft's 'IPO Pop Is Evidence Of Failure, Not Success.'

On the other hand, Ygal Arounian, a senior research analyst at Wedbush, said 'That’s typically a good sign to see a pop on the first day.' He has rated the company’s shares “Neutral” with a $80 price target.

The stock closed up 8.7% on Friday at a price of $78.29. During the day intra-day gains were as high as 23%. While this may look good in numbers, it wasn't as good as could be for a tech stock that was awaited this badly.

More than 70 million shares had been traded by the time the market closed and the company ended its first of day of trading with a market valuation of $22.2 billion.

'This is a lightning start for Lyft’s stock as investors are salivating [over] owning a piece of the $1 trillion ride sharing market,” Wedbush managing director Dan Ives said to CNBC. “The robust start to trading is also a clear positive for other tech names that are watching Lyft to gauge investor demand and Street reaction on this transformational consumer tech name.”

“We’re ready to be held accountable. We’re excited,” co-founder and President John Zimmer told CNBC’s Andrew Ross Sorkin on “Squawk Box” on Friday.

'In our case, I think what we’ve seen in talking to investors [is] that more people are maybe surprised to see the numbers that we’re putting out and I think this is a great part of the process. For us this wasn’t the goal — this is a milestone along the way — but we feel like it helps us with additional access to capital.”

This article has been provided by a Chasing Markets contributor. All content submitted by this author represent their personal opinions, and should be considered as such for entertainment purpose only. All opinions expressed are those of the writer, and may not necessarily represent fact, opinions, or bias of Chasing Markets.
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