Lyft Share Price Rises 10% On First Day’s Trading In US

Regular US day traders will be kicking themselves if they missed out on the Lyft Inc IPO on 29 March. At one point on first-day trading, the Lyft share price was up by 21%, boosting the profits of any savvy trader for the day. The price increase was reminiscent of the heady days tech companies experienced prior to the dot com meltdown.

The Lyft Share Issue

Lyft is the first of the ride hail companies to issue its shares to the public and is traded on the Nasdaq. The initial share price was set at $72 and increased swiftly on first-day trading to peak at $87.24. This rise indicated a valuation of around $29bn for the business. Prices fell later in the day, however, but were still up 10% by the finish of trading.

Lyft managed to raise approximately $2.5bn with this share issue and the company plan to use the capital for operating expenses and towards further capital expenditure which could include acquiring additional business interests.

Share Types

Long term investors will need to note that shareholders won’t have much right to influence company decision making. The shares are all Class A type which only entitles holders to one vote per share. Class B shares in the business are reserved for the company and entitle holders to 20 votes per share.

Lyft made the decision to launch the shares in the $70 to $72 price range following an early announcement they would be priced between $62 to $68.

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