The IPO market has been on fire, and one hot name could be about to join in on the party.
After much anticipation, Uber is expected to be making its long-awaited public market debut on Friday. The ride-sharing giant is expected to price shares between $44 to $50, down from the previous range between $48 to $50 per share. At the high end of the new range, Uber would have a valuation of about $90 billion on a fully diluted basis.
Uber’s IPO comes on the heels of main rival Lyft’s (LYFT) IPO on March 29. However, it hasn’t been a smooth road since IPO for Lyft. After pricing its shares at $72 and opening at $87.24, the stock has been struggling to regain its footing. Lyft’s troubles have caused investors to become hesitant to jump in on Uber’s IPO, especially because both companies are not profitable.
As other firms hold back from releasing coverage on Uber stock, Wedbush initiated coverage of the company on Wednesday and gave it an Outperform rating with a 12-month price target of $65. With very colorful and descriptive language, the firm compared Uber to Amazon (AMZN) and even suggested adding it to the infamous tech acronym “FAANG.”
“The ridesharing industry has become one of the most transformational growth sectors of the global consumer market over the past five years with Uber establishing itself as the clear #1 player and in our opinion is paving a similar road to what Amazon did to transform retail/e-commerce and Facebook did for social media,” Wedbush wrote in a note. “Uber is one of the most transformational companies in the world as the company has essentially single handedly changed the nature of transportation worldwide.”
As Uber gears up to hit the market, rival Lyft will be delivering its first earning report since its IPO. On Tuesday after the market close, investors will get a peek into Lyft’s financial health since becoming a publicly-trading company. Analysts polled by Bloomberg are expecting Lyft to report an adjusted earnings loss of $17.12 per share on $736.50 million in revenue.
Earnings season is winding down, and this week will be a bit quieter. Investors will be paying attention to a few big names like Disney, Papa John’s, Anheuser-Busch Inbev, Roku, Marriott and Viacom.
Meanwhile, the economic calendar remains light this week with the exception of key CPI data to be released on Friday. CPI data, a key inflation gauge, will play an even more critical role for market participants following the the Federal Open Market Committee’s (FOMC) meeting last week.
“Inflation has been disappointing in the past few months. The Fed pointed to transitory factors holding down price pressures at its most recent meeting. We agree with this assessment and view the recent weakness as driven by outsize moves in certain categories,” Credit Suisse wrote in a note to clients on Thursday. “Excluding these idiosyncratic moves, the underlying trend in inflation has not actually deteriorated significantly and we expect to see a mild acceleration in monthly inflation readings in the months ahead.”
Economists are expecting core CPI to have risen 0.2% from March and 2.1% from last year, according to data compiled by Bloomberg.
Tuesday: Allergan (AGN), Anheuser-Busch Inbev (BUD), Crocs (CROX), Mylan (MYL), Regeneron (REGN) before market open; Electronic Arts (EA), Lyft (LYFT), Match Group (MTCH), Papa John’s (PZZA), TripAdvisor (TRIP), Wingstop (WING) after market close
Wednesday: Chesapeake Energy (CHK), Coty (COTY), Honda Motor (HMC), Wendy’s (WEN) before market open; ANGI Homeservices (ANGI), Etsy (ETSY), IAC/InterActiveCorp (IAC), Roku (ROKU), Disney (DIS) after market close
Tuesday: JOLTS Job Openings, March (7350 expected, 7087 prior)
Wednesday: MBA Mortgage Applications, week ending May 3 (-4.3% prior)
Thursday: PPI Final Demand month-on-month, April (0.2% expected, 0.6% prior); Initial Jobless Claims, week ended May 4 (220,000 expected, 230,000 prior); PPI excluding Food and Energy month-on-month, April (0.2% expected, 0.3% prior); Continuing Claims, week ended April 27 (1.671 million prior); PPI Final Demand year-on-year, April 2.4% expected, 2.2% prior); Trade Balance, March (-$51.3 billion expected, -$49.4 billion prior); Bloomberg Consumer Comfort, week ended May 5 (60.4 prior); Wholesale Inventories month-on-month, March (0.0% prior)
Friday: CPI month-on-month, April (0.4% expected, 0.4% prior); CPI excluding Food and Energy month-on-month, April (0.2% expected, 0.1% prior); CPI year-on-year, April (2.1% expected, 1.9% prior)
Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter: @heidi_chung.
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