The Lyft and Uber Technologies are the ridesharing competitors that went public earlier this year. Not only both stocks trading down around 20 percent from the values at their IPOs (initial public offerings), that is underwhelming seeing in this year has been a mega year for IPOs.
But strangely, the shares frequently move in the tandem. The market looks to believe that what is good for 1, is good for others and same for bad things, as though both are aggressive competitors. Recently, this pattern was on display when the companies reported 2nd Quarter earnings on the following days. Lyft’s consequences came out after the market close on 7 August. Both ride-hailing stocks rushed in the next day’s trading. Stakeholders were pleased to get Lyft to smash their guidance for the quarter. Also, increase its view for the full year. And what had them request both the companies was Lyft saying that values were beginning to increase. A signal that price competition between these companies might be easing, profitability.
Lyft’s stock jumped as considerably around 9.3%, and it finished the session higher than 3%. Meanwhile, Uber Technologies Inc. shot up 8.2% on the news about the price war possibly cooling off. After the closing market, Uber reported their quarterly grades and in trading the next day; both stocks gave up their gains as Uber’s 2nd quarter numbers included 14% revenue growth and an adjusted loss that more than doubled from the previous year to US$656 million. Uber Technologies Inc. shares fell 6.8% on Friday and lost another 7.6% on Monday, August 12. Meanwhile, Lyft stock dived 9.5% in the two sessions following Uber’s grades. Uber and Lyft are moving in massively different directions. Lyft is quiet posting skyrocketing development, revenue up around 72% in the 2nd quarter, In the meantime, Uber is delayed out their top line increased 14% in its most current quarter, or 26% after adjusting for money translation and driver awards related to the IPO.