What Do Lyft and Uber’s Stock Prices Say About Their Future?
Following Uber's (NYSE: UBER) highly anticipated May 2019 initial public offering, the stock climbed to nearly $47 per share. The rest of the year has been less fortuitous for shareholders, who endured a fall to $29.22 by December. Rival company Lyft (NASDAQ: LYFT) experienced a similar ride. After being priced at $72 for its April 2019 IPO, shares briefly jumped above $75 before falling steeply to $50. Some mid-year momentum brought the stock back to $68, but a tough third quarter pulled Lyft all the way down to $40 before moving back up to $48. Both stocks are roughly 40% below post-IPO highs, while the S&P 500 is up approximately 8% over the same period.
Uber trades at a 3.86 price-to-sales ratio, while Lyft trades at 4.46, and neither is projected to be profitable in the short term. For reference, the software industry average price-to-sales ratio is 2.12. In the most recent quarter, Uber reported 30% year-over-year revenue growth to $3.8 billion, while Lyft's revenue rose 63% to $956 million. Lyft is growing more rapidly, but Uber's top line expanded by a higher dollar amount.
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Source Fool.com
