Since Uber's initial public offering will likely be fresh off of the heels of Lyft's, many are wondering if the volatility on Uber's trading will be more muted, and one trading adviser says that just may be the case.
Lyft priced its IPO at $72 a share before the first trade sent the stock up to $87, and then down to a low of $60 Wednesday.
"I think it [Lyft's volatility] might inform the process moving forward, where they [investors] know what to look for," said Shawn Cruz, trading manager at TD Ameritrade.
And if there's one thing that's incredibly clear about Lyft's profitability, it's that the company has seen widening net losses over the past two years, and that the path to profitability is almost invisible at this juncture. That doesn't exactly bode well for Uber, but maybe institutional investors won't bid the stock up to such heights, as they'll better anticipate Uber's risks.
"We actually had some analysts [Lyft analysts] come out afterwards and say 'look here's why this needs to be kept in perspective,' so investors might actually keep that in mind as we start to see Uber and other IPO's like Pinterest start to get placed out there," Cruz said. "I think it might actually help inform the process."
As for Uber's impending IPO, the company is set to release its prospectus as early as today, that will answer investors questions about its profitability.