Is Uber Blaming President Trump for Its Own Mistakes?
By Jitendra ParasharJun. 11 2019, Published 2:52 p.m. ET
Uber Technologies
US ride-sharing company Uber Technologies (UBER) just completed its first month as a public company after being listed on the NYSE on May 10. On its first trading day, Uber stock opened at $42.00 and settled at $41.57, much lower than its IPO price of $45.00 per share.
Incidentally, on the same day, President Donald Trump’s decision to raise tariffs on $200 billion worth of Chinese imports came into effect. After its disappointing market debut, Uber stock tanked nearly 18% from its IPO price in the two days after its listing.
Uber CEO blames Trump’s tariffs
Earlier today, during a discussion at the Economic Club of Washington, D.C., Uber CEO Dara Khosrowshahi expressed his views on the negative impact of Trump’s tariffs on Uber’s stock performance.
He said, “The timing of our IPO was very much aligned with our president’s tariff wars – the same day,” according to a USA Today report. Khosrowshahi added, “So I think we got caught up a bit in the market swirl. And there’s nothing you can do about it.”
Is Uber blaming Trump for its own mistakes?
The recent escalation in the US-China trade war indeed triggered a massive broader market sell-off in May. However, we shouldn’t forget that on May 10, Uber’s first trading day, the S&P 500 benchmark rose 1.0%. Uber stock also continued to underperform the broader market and its home market peer Lyft (LYFT) on its second day after listing on the exchange. On May 13, Uber tanked 10.8%, while the S&P 500 Index and Lyft fell 2.4% and 5.8%, respectively.
Uber stock has been trading on a negative note for the last four days despite sharp broader market recovery. Last week, Bloomberg reported that two of Uber’s top executives, “Barney Harford, the chief operating officer, and Rebecca Messina, the chief marketing officer, are both leaving the company.” The news hurt investors’ sentiment and could be one of the reasons why Uber stock has been falling lately.
Blaming Trump’s tariffs for everything that’s gone wrong with Uber stock after its IPO doesn’t seem entirely fair.
On June 10, Uber stock fell 3.5% against the 0.5% gain seen in the S&P 500 benchmark. Today as of 12:37 PM EDT, Uber was down 1.9%.
