Short selling of Uber shares appears to have been in line with most other high-profile tech flotations, suggesting that bankers will have to look elsewhere for culprits for the ride-hailing company’s post-IPO plunge.
According to the first indications available, on Tuesday there were just 8.4m Uber shares out on loan to short-sellers, representing 5 per cent of the float, according to IHS Markit.
That is a little higher than the 2 per cent of shares in Twitter and Snap, the owner of Snapchat, that were on loan at the same point after their IPOs, and matching the 5 per cent at Facebook.
By contrast, nearly 30 per cent of Lyft’s shares were on loan at its first settlement date, a figure that was among the highest ever and fuelled recriminations between the Uber rival and Wall Street. Lyft shares fell below their $72 IPO price on their second day of trading and stayed under pressure. On Wednesday they traded at less than $54.
Uber has never traded above the $45 at which the heavily lossmaking company sold $8.1bn of shares last week.
The stock fell as low as $36.08 on Monday, but it has since recouped some ground. It was trading at $40.49 at midday in New York on Wednesday, up 1.3 per cent on the day.
Borrowing costs on Uber shares were also low at an annualised rate of about 2.5 per cent, although that mainly reflects the relatively large size of Uber’s float.
At the comparable point in their life as a public company, borrowing costs were 39 per cent for Facebook shares and 13 per cent for Twitter, according to IHS Markit. For Lyft they were 99 per cent, reflecting the high demand from short-sellers making their bearish bets on the company’s prospects.
Another research provider, S3 Partners, estimated that short interest in Uber is as much as 20.7m shares, or 11.5 per cent of the float, counting both borrowed stock and short selling using that using other securities as collateral.