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Uber hoped to celebrate a big payday. Instead, a sinking stock and more protests

Suhauna Hussain and Johana Bhuiyan, Los Angeles Times on

Published in News & Features

LOS ANGELES -- Around 50 cars with Uber and Lyft logos plastered on their windshields wound through the palm tree-lined streets of Beverly Hills, down Rodeo Drive and into the quiet hills, past palatial homes.

They stopped in front of the $71-million residence of Garrett Camp, co-founder of Uber, and the drivers piled out.

"Uber, Uber, you can't hide, we can see your greedy side," they chanted.

Wednesday marked the end of the lockup period barring insiders from trading Uber shares -- and it could have marked a moment of exuberance for the company's employees, investors and founders, like Camp. Instead, the ride-hailing firm commemorated the day with a record-low stock price and fresh protests from Beverly Hills to Atherton.

When all goes according to plan for a high-flying start-up, the end of a lockup period is the moment paper millionaires can turn into real millionaires. But the 180 days since Uber's IPO haven't brought the company much good news, nor did Wednesday's potential payday.

Lackluster quarterly results in Monday's earnings report did little to prevent early investors from flooding the market with shares the moment they could.

 

Amid a sell-off that made it one of the most actively traded stocks in the U.S. by value, according to Bloomberg, Uber hit an all-time low of $25.58. The business news outlet reported that one block trade involved 7.75 million shares at $26.02 apiece, and a separate sale of 2 million shares at $26.90 apiece -- both below the previous day's close of $28.02. It's unclear which shareholders were behind those major sales.

Shares are down about 40% from Uber's initial public offering price of $45. Uber closed Wednesday at $26.94.

Uber declined to comment on the protests and referred questions about the end of the lockup period to a transcript of its quarterly earnings call with analysts Monday. "Obviously there is a lot of supply that's going to hit the marketplace and we don't know what's going to really happen," Chief Financial Officer Nelson Chai said on the call, "but you can rest assured we've taken whatever steps we can to have the dialog that we need to with most of the parties."

This year has been a flop for many tech companies making their Wall Street debut. Highly anticipated initial public offerings from Uber and Lyft tanked right out of the gate, and WeWork crashed and burned before it even reach an IPO, suggesting that high private market valuations are no guarantee of public market success.

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