Uber's disastrous record – the worst dollar loss ever recorded for the first day of an IPO in the United States

Uber's long-awaited IPO managed to break a record, but that was not what investors could have hoped for.

The stock closed down 6.7% on the day of opening at 41.70 USD (63.31 USD), down from the price of 45 USD per share listed Thursday night before the initial public offering. savings that valued it at 75.5 billion USD.

In total, the reduction in the IPO price meant that the investors receiving this award had suffered a cumulative loss of US $ 655 million. At the end of the day on Friday, Uber had a market capitalization of US $ 69.7 billion, well below the valuation value of US $ 120 billion suggested by the bankers in 2018.

That made the biggest dollar loss of an American IPO, said Jay Ritter, a professor at the Warrington College of Business at the University of Florida, at Business Insider. Ritter's figures represented IPOs from 1975 onwards.

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As for percentages, the other IPOs were much less affected by the opening day. According to Ritter, Uber's first day is the 99th worst market opportunity for IPOs of more than $ 100 million.

That's the combination of the drop and the size of the IPO that makes it the biggest dollar loss of the first day.

Before Friday, the biggest dollar loss on the first day of an IPO in the United States had occurred in 2000, when Genuity, an Internet company created from Verizon, had been made public. First day, the Wall Street newspaper Journalist Rolfe Winkler said Genuity had lost $ 233 million.

The dollar losses on the first day of Uber are therefore almost three times larger.

The IPO of Uber took place during a particularly hectic week as tensions between the US and China increased. The timing may have cost the company billions.

– This story was first published at BusinessInsider.com.au