If the buzz around the Uber and Lyft IPOs has you wondering how to invest, you may want to reconsider. Experts weigh in on when and how it's best to invest in newly-public companies.
For multiple companies, it's the moment they've been waiting for: The window has opened for them to go public.
"IPOs aren't just about, 'Oh, I want to invest in the things I know,'" said Kathleen Smith, principal and manager of IPO ETFs at Renaissance Capital."It's about, 'How do I make money investing in these?''In today's market, chances are that buying in on a newly public stock could be a losing proposition. Financial experts say there are several reasons why.
Uber previously raised roughly $20 billion in funding and is eyeing a $120 billion valuation when it goes public. Lyft has raised more than $5 billion and plans to be valued at $23 billion. While many IPOs close up on their first day, that first day pop and subsequent run up is not guaranteed, according to Michael McKevitt, director of financial planning at Guillaume & Freckman.
"Even if you pick the right company, like Facebook, which has done amazingly well, you still had to put up with a 50 percent decline, multiple 40 percent declines, multiple 20 percent declines," McKevitt said."How many people bought it and held onto it through all of these moves?" "You can sometimes see the stock price has a pull back — not always, but there can be — when the lockup ends," Gorman said.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
The admissions scandal revealed yet another reason to rethink college sportsThe editorial board urges universities to examine more broadly the oversize role that varsity sports have played at universities. 'It’s a myth that schools will see alumni donations plummet if they cut back on varsity sports teams.' (via latimesopinion)
Read more »
Steel stock investors beware: Price-crushing 'Steelmaggedon' is coming, says BofANew U.S. steel capacity will swamp the market and drag on steelmakers' profit margins, Bank of America Merrill Lynch says.
Read more »
Lyft outlines all the reasons ridesharing could fail, in its IPO documentsScooters and bikeshare, self-driving promises and lawsuits requiring better treatment of drivers could all stand in the way.
Read more »
As Lyft kicks off IPO roadshow, investors still uncertain about profitabilityPotential Lyft investors are questioning how and when the company will make money.
Read more »
Pinterest’s IPO filing: 5 things investors should knowPinterest’s 184-plus page S-1 had a surprise or two about the online image discovery company.
Read more »
Before the Levi's IPO, there was the 1985 buyout led by iconoclastic S.F. investor Warren HellmanWarren Hellman, a legendary Bay Area investor and philanthropist, helped lead the buyout of Levi's 34 years ago.
Read more »
What You Need To Know About The Lyft IPO: Strong Investor Demand And Strong ESG CharacteristicsSharing economy unicorn Lyft has turned to the public markets for growth capital. Accordingly, a wide range of investors will be able to purchase Lyft stock, which will trade on the Nasdaq, due to its strong overall ESG profile. The IPO is already oversubscribed.
Read more »
Here's what you should know about the IPO processUber, Lyft, Pinterest and Airbnb plan to break into the public market. Here's how the process unfolds.
Read more »
Here's who stands to get rich from Lyft's IPOLyft's major shareholders will collectively hold billions in value when the company debuts.
Read more »