IPO Roundup: Lyft gives investors a peek under the hood for upcoming IPO as roadshow gets underway

The San Francisco ride-hailing company will list on the Nasdaq under the stock ticker 'LYFT', while the iconic Levi’s jeans maker will trade under the symbol 'LEVI'

A Lyft vehicle on the road
In the fourth quarter of 2018, San Francisco-based Lyft had 18.6 million active riders and 1.1 million drivers

Ride-share company Lyft Inc, which is Uber’s closest rival, announced Monday that it is kicking off a roadshow for an initial public offering that could happen in the next two weeks.

It also filled in more details pegging its valuation at between $21 billion and $23 billion. The range, equating to between $62 and $68 a share, is preliminary and could change by the time the shares start trading around the end of next week.

READ: Lyft takes IPO fast lane, zipping ahead of rival Uber

“The overall valuation is on a fully diluted basis and includes the roughly $2 billion Lyft is expected to raise in the offering. The company and its underwriters will set a final IPO price based on feedback from investors in the roadshow,” reported the Wall Street Journal.

The stock will trade as LYFT on the tech-laden Nasdaq, and the IPO range is currently set for between $62 and $68 per share to sell 30.7 million shares.

In a sign of that demand, even at the low end of the expected range, Lyft would be valued far more than it was in its last private valuation — $15.1 billion as of early 2018.

Lyft, which is part of the sharing economy, makes money by taking a commission on rides booked through its mobile app.

Hotly anticipated season for tech startups

The San Francisco-based ride-hailing company’s filing lifted the hood on its financials. Lyft's revenues doubled in 2018 to reach $2.2 billion, according to the contents of its S-1 registration with the SEC. That is up from $343.3 million in 2016 and $1.1 billion in 2017.

But like Uber, Lyft is hemorrhaging money. Its net loss climbed to $911.3 million in 2018 from two years of steady losses of $682.8 million in 2016 and $688.3 million in 2017.

Lyft claims its ridesharing market share grew to 39% in 2018, up from 22% in 2016. In the fourth quarter of 2018, it had 18.6 million active riders and 1.1 million drivers.

The year started ominously for IPOs after the government shutdown in Washington, DC proved disruptive. However, 2019 is now shaping up to bring a stampede of so-called unicorns to Wall Street. Uber, Airbnb, Slack, Pinterest and Postmates are all expected to go public this year, providing a veritable bonanza for early investors.

According to market watchers, the IPO represents a big test of how richly valued, private tech companies fare in the public markets and they will be closely watched by the other startups waiting in the wings.

Levi Strauss & Co

The maker of the iconic 501 blue jeans, Levi Strauss & Co revealed that it will offer 36.7 million shares when it begins trading on the New York Stock Exchange this week, pricing shares between $14 and $16.

At the high end of that valuation, the San Francisco-based company would raise nearly $587 million. The company will trade under the symbol LEVI. The public offering is being underwritten by Goldman Sachs, JP Morgan, and Morgan Stanley.

News of a pending Levi’s IPO surfaced last November and plans were put into motion last month.

Bavarian immigrant Levi Strauss started the quintessential American company in the mid-1800s during the California Gold Rush. The 166-year old company, which is still controlled by the descendants of its namesake founder, has traded publicly before but went private 34 years ago in 1985, when the family took it private again amid slumping sales.    

Just a few years ago, Levi’s future was imperiled by high debt on its books as it tried to reinvent itself in a crowded field by being less dependent on retail stores.

“When CEO Chip Bergh took the company’s helm in 2011 things began to turn around with repeated quarters of double-digit growth,” reported Fortune Magazine. “Bergh also has made Levi’s a values-driven company, by lending vocal corporate support to issues such as gun violence prevention, voter turnout, and climate change prevention.”

The public offering is being underwritten by Goldman Sachs, JP Morgan, and Morgan Stanley.

Contact Uttara Choudhury at [email protected]

Follow her on Twitter@UttaraProactive 

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