Why I Almost Bought ,000 Worth Of Uber Stock Today…But Didn’t

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Well guys i almost done did it i almost bought the uber d booba stock today okay uber’s having a bit of a tough day it stocks down around 7% now to be fair the markets are down in general today but it’s not like the markets are down 7% certainly okay nasdaq is down about 0.8% but you have ober down about 7% here today and that comes on the back of its earnings

That basically came out last night and not a lot of investors were honestly liking those uber numbers okay now i want to go ahead and share with you why i almost almost i was like two clicks away from buying five thousand dollars worth of uber stock here today no it’s pretty common for me to buy anywheres from like $2,000 to $5,000 whenever i initially start a

Position in a company and this would be my first time i ever bought uber stock so i was thinking about 5,000 dollars worth and i came about two clicks away from doing it and then i decided not and i want to share with you why i decided not to buy uber stock ultimately today and why i believe i’m gonna get this stock for a lot cheaper in the future okay but before

We get into that i want to share at least my thoughts on why i actually like uber as a company and why i think oberer will actually grow into a much bigger company in future years okay so i hope you guys enjoy this video as always make sure you smash the thumbs up button and let me know in the comments section what your thoughts are around uber stock i would love

To hear from you guys as always and by the way if you want to share your thoughts around lyft stock i would love to hear those as well okay so if we think about uber here’s how i’m personally thinking about uber the business model and what the company is doing okay so you have over which basically runs a needs-based business as not going anywhere if you think

About transportation if you think about ride-sharing and whatnot those type of things are not going anywhere and that is a business model that is essentially really like needs-based i mean i really saw it in person when we went out to vacation in san francisco i saw you know when you have these condensed areas like a san francisco or something like that like

Uber is pretty much a necessity i mean it doesn’t even make sense to try to drive your car around san francisco and whatnot like uber is a must okay so if you’re dealing with any type of big metropolitan area or you just can’t afford a car in general like uber is literally a needs-based business and i cannot see that business model going away anytime soon before

You had companies like uber and lyft you had obviously the taxi industry and in ubers just kind of taken over that industry they completely disrupted it obviously and so the needs based business that’s not going anywhere i like those type of businesses and then you go ahead and you run that into the fact that those pretty much the number one or number two player

Pretty much on all markets across the world so this means you have the massive business that’s a needs-based business and you have the company that’s the number one or number two player and pretty much all the key markets around the world that you would want to be in and so this to me right off the bat is very very enticing i love business models where they’re the

Number one or number two player in the market okay and if you look at uber as far as their market share and many of the most important work that you would want to look at they’re actually the number one player in so many markets across the board and i love that about this company okay so needs based business number one number two player around the world and they

Already scaled their business which essentially makes competition trying to come in almost a key word is almost impossible okay if you’re gonna think about this okay who could really compete with uber could amazon come in compete with uber know could facebook could apple could google know you could make somewhat of an argument with google with with way mo down the

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Road maybe there have a potential competitor we’ll have to see all that shakes out but and then if you think about like the venture capital space let’s say there’s a venture capital company they want to put a hundred million dollars into a project and compete with somebody like uber and try to disrupt them and come in that space right it’s gonna be really really

Difficult and pretty much impossible because ubers already scaled at this point in time and so how are you gonna beat ober in this situation you’d have to try to undercut their pricing to try to get consumers on that but if you undercut their pricing then you’re still gonna have to pay the drivers just as much as they would make on uber or lyft if not more right

To attract those drivers which means your losses would be out of this world okay i mean uber and lyft they already lose a ton of money now imagine if a company try to come in and undercut their pricing but they still have to pay the drivers just as much if not more okay it’s an impala simple it’s an impossible competition there’s only one company in the entire

World that i can pretty much see actually having a legit shot okay the key the key word is shot at actually disrupting uber in that is tesla they were the only ones in the entire world that could actually disrupt uber if they wanted to with what they’re doing with self-driving the fact that there’s a likelihood that tesla could have full self-driving vehicles on the

Roads within two years and then if they could get government to basically allow those self-driving vehicles to be taxis and things like that tesla is really the only one that has a chance but that is still a very hard thing for test sort of pull off okay so when you kind of think about this new thing about competition there’s almost no competition that can exist

For uber here in the short term or even if you’re looking out over the long term okay it’s it’s almost impossible there’s really only one company i can see it so you’re looking at a player that’s pretty much almost guaranteed to be the number one or number two player in all these markets for a long long time into the future okay that is obviously a very exciting

Opportunity okay then there overeats business which is a very very fast growing business obviously that’s food delivery and so you’re at your house and you want to place a food order and basically you don’t have a car to go get it or you just don’t feel like getting it you just want the food deliver to your house there are more and more restaurants constantly

Coming on to overeat so basically you can order from the food will get delivered to your house okay in my opinion they should be the number one or number two player in food delivery if you’re looking at a long term basis i think this will be very clear to see within about a year to a year and a half i think as of right now there’s so much competition in delivery

It’s not really clear like how many companies are gonna make it are there gonna be four players in this space and there going to be one or two players in this space it’s not really too clear on who the for sure companies will be but i can almost guarantee you that uber eats will be one of those for sure companies with their scale with their brand and things like

That i really just can’t see them not being the number one or number two player their competition obviously is doordash grubhub postmates caviar but caviar really competes on more like the higher-end restaurants and things like that so there’s definitely several competitors along with smaller competitors in these different markets but if i look at it the scale and

The funding uber has to uber eats work i honestly think overeats will be the number one or number two biggest player in that market and that’s going to be a massive massive market go into future years okay by the way it’ll be very clear to see who are the actual winners within a year year and a half and then from there likely the winners will stay the winners in


That space okay this is going to be an extremely extremely profitable company in my opinion if you look on a long term basis looking out three years five years seven years from now and the reason being is this a monopolized type industry okay that is needs-based and when you you have like a monopoly on an industry guess what you can do with pricing over time you

Can have it go up and up and up and so if you look at uber in the past okay and you look at uber since the the service started and whatnot they’ve had to compete because they had tons of competitors coming in the space and everybody wanted a piece of the pie and everybody wanted to be where uber is now okay so to get to this place they’ve had to keep prices as low

As possible for rides and all those sorts of things okay but now they’ve gotten to a place where it’s pretty much impossible to compete with them if you’re a new entrant into this space and so if you’re looking on a longer term basis as the company continues to scale bigger and bigger and bigger yes what’s gonna happen the price of rides are gonna go up more and

More but meanwhile most competition won’t even be able to enter the market so there’s nothing that can really happen there and so what ends up happening all that money starts to flow down to the bottom line so if you’re looking at a longer term basis as will actually be a very profitable company and this is why you bir can probably get to a place at some point in

Time where it’s got a market cap in the hundreds of billions of dollars versus a market cap today about sixty six billion or so okay so that’s exciting from a long-term perspective also they do have their ober freight business which has you know big potential in the freight industry okay so needless to say i actually really like a lot of what’s going on with uber

I like their current management team that they have in there i think they’re actually doing a very good job trying to run this big massive business essentially okay i love the fact that they raised a ton of money obviously in the ipo and they have a lot of cash now on that balance sheet so you know we’re looking at all this i’m definitely very excited and this is

What made me think hey man the stock is you know five dollars or whatever underwear ipo that maybe it’s worth me going ahead and starting a position in the stock and starting to build it build it more and more over coming months okay but ultimately i decided not to buy this stock and let me share exactly why i decided not to buy this stock here today okay so when

It came down to is essentially in november in november so only a few months away okay we’re in august now then you have september then you have october and then you have november for those you might not know the calendar but november what happens in november a big ipo lock-up happens so essentially a ton of the early investors and executives of uber will be able to

Start legally selling their shares on the market and they’re gonna be able to dump out of those shares now keep in mind a ton of these investors are up millions of dollars tens of millions hundreds of millions or billions of dollars on their shares okay so meaning if they don’t honestly freaking care if uber is at $40 a share or $42 a share or 37 dollars a share or

$35 a share so a lot of those investors that will likely sell out when the november expiration comes a lot of them honestly don’t care about price okay they’re theirs they’re planning on selling don’t matter what because they’ve already made so much money on this stock they just want to get out okay they just want to get those shares out maybe they don’t want to sell

All their shares but they at least want to get a portion of their wealth out of this company to go i don’t know buy fancy homes and fancy cars with and go on crazy vacations or just put into the bank or invest in the next over or something like that right those individuals they want to do that they don’t necessarily want to stay all in this stock which there are

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Tons of executives at that company or current executives or you know early day investors that honestly have a ton of their wealth tied up in this one company and they want to look to diversify okay so when i’m looking at that when i think about a lock-up expiration i think about a couple things okay one is wall street noses and wall street’s probably don’t worry

About this a lot over the coming months you know wall street’s worrying about this a lot over the coming months and you could continue to see selling pressure on uber stock as we get closer and closer to that lock-up expiration okay also the when november actually hits and they can actually sell their shares these early investors and these old executives of the

Company then if they can actually sell their shares you could be looking at stock that goes down faster and faster and faster and this is why a lot of ipos will go down more and more and more like three months six months nine months down the road after an ipo happen there’s also you have the lock-up then all of a sudden in 2020 you have a second lock-up expiration

Okay so which means more and more of those early day investors and executives can dump even more shares on the market okay so if you’re looking at all that that obviously doesn’t put uber in the best situation at least in terms of share price growth in the short term now it is possible that despite all these worries and despite probably a lot of insider selling

Come to november expiration it is possible the stock could go up but if i’m thinking about the likelihood that a stock like this goes up with all the worries about the economy and could we go into recession at some point and just kind of move away from a lot of these ultra growth companies to maybe some more conservative companies if i’m thinking about all this

I’m thinking uber shares are probably going lower and if i start a position at $40 that’s probably gonna be too high because this is probably gonna be a stock that goes into the 30s and maybe keywords maybe even potentially the 20s at some point in late 2019 or in 2020 at some point in time okay and so if i’m thinking about this i’m thinking why do i need to rush

Into these shares today at a sixty six billion dollar market cap for a company that loses money yes i love so much about this company but at the end of the day the fact is i’m still paying 66 billion for a company that is losing money and will probably continue to for at least a year or two into the future and then when they do start to make money you’ll probably

Be very very small profits do i absolutely need to rush into this company today with the lockups coming in 20 at the end of 2019 and then moving into 2020 and then the answer is no okay i don’t need to rush into this company today if i miss out on the opportunity and the stock halston goes from forty to sixty hey it is what it is we missed out on that opportunity

There are plenty of other great stocks i could put my money in in the short term here that might honestly even do better than long term so if i’m looking at and i’m like you know what let’s just slow our roll on this one let’s wait to see what happens with those lock ups that’s wait to see if this stock drops into low 30s then maybe we’ll start a position in the

Stock and if it goes into the 20s then where they’re going to become very very interested in this stock guy so anyways hope you enjoyed this video as always make sure to smash the thumbs up button if you did all right and let me know your opinion uber in the comment section thank you for watching and have a great day

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Why I Almost Bought $5,000 Worth Of Uber Stock Today…But Didn't By Financial Education

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