Uber Technologies’ (UBER - Free Report) co-founder and former chief executive officer Travis Kalanick sold nearly 21% of his stake in the ride-hailing giant following the lock-up expiration on Nov 6, according to a Nov 8 sec filing. An IPO lock-up period places a restriction on insiders, who bought the company’s shares during its pre-IPO time, from selling the stock for a specific time frame after it goes public. While this time limit varies, it usually ranges from 90 to 180 days from the date of the IPO.
Kalanick sold more than 20 million shares worth approximately $547 million while still retaining shares in excess of 75 million with a total of $2 billion.
Uber’s shares have been witnessing a downtrend ever since the company went public on May 10, 2019, with the stock having declined more than 34% ever since. The company made its trading debut at a price of $45 and has now been reduced to $27.14 (as of Nov 11 close). In the meantime, Kalanick sold his shares at a price of $26.65-$27.4.
The company, grappling with cost pressure, incurred huge losses in each of the three quarters post its IPO. Significant sales and marketing expenses are weighing on its bottom line. While sales and marketing expenses surged 55% year over year to $3.37 billion in the first nine moths of 2019, total expenses soared 72.3% to $17.7 billion.
Zacks Rank & Other Key Picks
Uber carries a Zacks Rank #2 (Buy). Some other top-ranked stocks in the same space are Marchex, Inc. (MCHX - Free Report) , Akamai Technologies, Inc. (AKAM - Free Report) and HealthStream, Inc. (HSTM - Free Report) . While Marchex sports a Zacks Rank #1 (Strong Buy), Akamai Technologies and HealthStream carry the same Zacks Rank as Uber. You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Marchex, Akamai Technologies and HealthStream have rallied more than 56%, 39% and 13%, respectively, so far this year.
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