Lyft, the most highly anticipated IPO of 2019 clocked its first trade this morning at $87.24 per share, 22% above the IPO price of $72 per share, the shares ended the day up +9% at $78.29 per share.  This is the first technology IPO in the coveted ‘gig’ economy vertical, Lyft is the second largest ride-hailing company in the U.S., behind Uber.

The public markets have been very receptive towards the Lyft debut, the IPO had priced 10% higher than the midpoint of the original range of $62-68 per share. The company raised $2.7 billion on the back of an upsized share offering of 30.8 million shares. The stock trades under the ticker symbol “LYFT” on the Nasdaq with market capitalization of $24.3 billion (IPO price).

Grizzle’s deep dive on the stock highlighted the near-term trading opportunity in the shares, however, the outlook gets more challenged when Uber announces their IPO, which is anticipated in the first half of 2019.

Based on our in-depth analysis of the company we believe the company will struggle to be cashflow break even before 2026 — that scenario implies a bullish long-term outlook of 11% rider growth per year.

Lyft’s challenge will be to remain relevant to both consumers and investors, something Snap could not achieve. Snap shares are down 45% since its 2017 IPO debut and has a high short interest (17% of float).

SNAP Stock Performance since IPO

SNAP Stock Performance since IPO

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The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Grizzle hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.