Two-Thirds of Investors Avoiding Lyft and Uber Stock

This week’s Sentiment Survey special question asked AAII members for their thoughts about Lyft and Uber going public. Nearly two-thirds of respondents (65%) say they would avoid investing in either company. Reasons included the lack of profitability, a general avoidance of initial public offerings (IPOs), not closely following either company, the lack of profitability and both driver and passenger safety issues. Nearly 13% think the stocks could eventually turn out to be profitable investments or otherwise think it was a good idea for the companies to go public. About 4% express concerns that these IPOs could be a sign of the market approaching a top.

Here is a sampling of the responses:

• “I think it is a little too early for both as they still have major issues with their culture and the security of their passengers.”
• “I think it is way too soon for both. They are losing way too much money and it is not clear to me that either will ever be profitable.”
• “They are great concepts; however, I would not buy the IPOs or the stocks until a later date.”
• “They are going to do very well. They are good businesses.”
• “I don’t invest in unprofitable companies.”

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