analytics

UBER goes to IPO: what investors should know

UBER IPO

Lyft, Pinterest and Airbnb also go on IPO

UBER Technologies has decided on an IPO platform – this will be the New York Stock Exchange (NYSE).

At first it is worth explaining why investors pay attention to IPO. IPO (Initial Public Offering) is an event when a private company places part of its shares on the stock exchange for sale to investors. To enter an IPO, a company must comply with a number of regulatory requirements aimed at disclosing financial information and transparency. This is necessary to protect investors from buying shares of unscrupulous companies.

IPO is one of the most popular ways to attract investments for business development. In particular, American firms often resort to the mechanism, where the majority of large companies are public (their shares are traded in free circulation on the stock exchange).

The IPO of the online taxi service can be one of the biggest in history. According to Bloomberg analysts, the value of the company as a result of the placement of shares could reach $ 120 billion. If UBER places at least 16% of its shares on the stock exchange, this IPO could be one of the 5 largest in history.

Also in the near future are going to hold their IPO a number of other well-known companies. First of all, we are talking about UBER’s competitor – the service of ordering cars Lyft, the service of renting private housing all over the world, Airbnb, and Pinterest photo hosting.

Investors often see IPOs as a way to invest in a promising company at the initial stage. Also, speculators enjoy the opportunity to buy shares, hoping that their value may rise sharply during the start of trading on the exchange. At the same time, professionals recommend only trained traders to participate in the ICO.
The fact is that after an IPO, stocks often behave extremely volatile. Even professionals are often hard to predict how a company will behave after being placed on the exchange. Quite often, the value of stocks drops sharply, and months, if not years, are needed for recovery.