Analyzing the Performance of Uber’s Initial Public Offering (IPO) and Its Impact on Market Returns: A Three-Year Study

Assignment Instructions:

This is for our finance class IPO project paper. Please answer the 3 questions below for the Uber. NOte: my professor will use the turnitin for this paper please do not copy form other sources make sure you use all your knowledge and make your own anlaysis and cited all the sources you can use yahoo. finance as well.
Please answer s these questions for the Uber:
1. Identify an initial public offering (IPO) that has been announced and completed at least 3 years back (since 3-year post-IPO price performance is required).
2. Compute underpricing (1st day closing price – IPO price) / IPO price. Compare it with the market return on the IPO day.
3. Compare the stock performance with market (S&P500) performance over 3 year following the IPO. Download historic stock returns from yahoo.com. Draw a graph of compounded daily stock returns and compounded daily market returns from the 2nd trading day to 3 years after the IPO. That is,
2nd day compounded return = (2nd day closing price – 1st day closing price) / 1st day closing price
3rd day compounded return = (3rd day closing price – 1st day closing price) / 1st day closing price

How To Work On This Assignment(Example Draft/Essay)

The initial public offering (IPO) of Uber, announced and completed on May 10, 2019, is the subject of this study. This paper aims to analyze the performance of Uber’s IPO and its impact on market returns over the three years following its completion. The three questions presented above will be answered to achieve this goal.

Firstly, the underpricing of Uber’s IPO will be computed by subtracting the IPO price from the first day’s closing price and dividing the result by the IPO price. The market return on the IPO day will be compared to this underpricing to determine the level of deviation from the market. The results will be presented along with a discussion of their implications for investors.

Secondly, the stock performance of Uber will be compared to the performance of the market, represented by the S&P500, over the three years following the IPO. Historical stock returns will be downloaded from yahoo.com, and a graph of compounded daily stock returns and compounded daily market returns from the second trading day to three years after the IPO will be drawn. The second day’s compounded return will be calculated by subtracting the first day’s closing price from the second day’s closing price and dividing the result by the first day’s closing price. The third day’s compounded return will be calculated in the same way. The resulting graph will be analyzed to draw conclusions about Uber’s stock performance and its relation to the market.

In conclusion, this paper will provide an in-depth analysis of Uber’s IPO and its impact on market returns over the three years following its completion. The findings will be presented in a clear and concise manner, with proper citation of all sources used in the analysis. This study will contribute to the understanding of IPOs and their impact on the market, providing insights for investors and policymakers alike.