DF Markets launches CFD trading on Uber shares

Person holding phone with "Uber" app on screen

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Dear traders,

We are happy to inform you that we are expanding our instrument portfolio by adding Uber shares as CFDs.

Uber Technologies (UBER), one of the most popular ride hailing companies in the world, has already gone public as of Friday, May 10, and is being traded on the New York Stock Exchange (NYSE). This happens on the backdrop of heightened investor interest and shortly after the Uber drivers’ strike across Europe, the US and several other countries with demands for better pay.

Starting from Monday, May 13, DF Markets will offer its clients the opportunity to trade CFDs on Uber shares under the following conditions:

  • Margin requirements of 20% for professional and retail clients;
  • Only long positions (no short-selling) in the first several days of trading;
  • Cash CFDs on 100% margin, with no fees, interest and commissions

The Initial Public Offering (IPO) was one of the most eagerly anticipated events on Wall Street. In the months preceding it, the company was valuated at the staggering $100 billion – a sum that would have ranked Uber among the companies with the highest IPO valuation alongside Facebook and Alibaba. Eventually, in its prospectus the company was valuated at around $82 billion, or at a price of $45 for each of the nearly 180 million common shares, with a funding target of $8.1 billion.

The expectations of Uber’s performance in the first days following the IPO were mixed and this was entirely justified. As it soon became clear, the IPO did not perform very well during the initial trading day. As a result, its price fell by nearly 8% and closed at $41.6 at a market cap of $69.7 billion. This turn of events, however, hardly surprised anyone.

In the days preceding the initial offering, many analysts drew comparisons to Lyft – Uber’s main competitor in the ride hailing business – whose shares currently trade at around 15% below the IPO price.

“Still, no matter how Uber’s stock fares on Friday, it might be a mistake to write it (or Lyft for that matter) off for the long haul,” wrote CNN’s business editor Paul R. La Monica.

Another analyst – Asad Hussain, an emerging technology analyst at PitchBook – noted that Uber and Lyft have not been tested during a downturn and it is yet unclear of just how resilient their business models would be during a period of contracted consumer spending. “To regain investor confidence, we believe both management teams will need to execute well over the next few quarters while maintaining robust revenue growth and convincing the market that a path to profitability exists,” Hussain added.

We are yet to see how this will be achieved, particularly considering the ongoing problems Uber has with various transport regulators across the world and with its own drivers who continue to protest. Uber lost $1 billion in Q1 2019 alone  and has never been on the green. In the 10 years of its existence the company has lost around $9 billion and recently warned that it may never turn profitable.

Uber’s other projects

Even though most people think of “ride hailing” and “taxi” when they hear of Uber, this is by far not the only business that the company operates.

Other popular services, for instance, are:

  • Uber Eatsfood deliveries from restaurants and fast food joints participating in the programme.
  • Uber Freight – logistics services through a mobile app that connects freight drivers, companies and clients for shipping.
  • Jump Bikes – a daughter company of Uber for scooters and electric bicycles for rent, available in 12 US cities, Berlin, and in Lisbon.

The most intriguing project of Uber currently is Uber ATG (Advanced Technologies Group) – a subsidiary developing fully autonomous vehicles. The tests started in 2006 and, despite the several accidents involving Uber’s driverless cars, continue to this day. Incidentally, this is also Uber’s subsidiary that consumes the largest share of the company revenue.

Uber as told in figures

As per Uber’s IPO prospectus, in 2018 Uber:

  • Lost $1.8 billion (and has never turned profitable);
  • Has a revenue of $11.3 billion, or 40% year-on-year growth;
  • Offers its transport service and Uber Eats in 700 cities across the world;
  • Has an average of 91 million users (transport and food) per month;
  • The ride hailing service users have a total mileage of 26 billion miles;
  • Has 3.9 million drivers.

For further information on how to trade Uber shares through our platform, please visit the Range of Markets section of our website.