Lyft Inc. was sued by investors who claim the ride-sharing company overstated its market position when it went public last month, leading to a dramatic plunge in its stock price.
Two separate class-action complaints against Lyft, as well as its officers and directors and underwriters, were filed Wednesday in state court in the company’s hometown, San Francisco.
Uber Has Spent More Than $1 Billion on Driverless Cars By Mark Bergen
Uber Technologies Inc. has spent more than $1 billion on autonomous vehicle technology to compete with giants such as Alphabet Inc., Apple Inc. and General Motors Co.
The ride-hailing company reported $457 million in research and development expenses for its self-driving unit on Thursday in its filing for an initial public offering. That was up from $384 million in 2017 and $230 million in 2016. Those numbers also include other tech projects, such as a flying car initiative. Uber also warned prospective investors that its adjusted losses would rise in the near term thanks, in part, to those costs.
Uber has already begun trimming its spending on self-driving cars. In the fourth quarter, it spent $89 million on its research division, down from $129 million in the second quarter.
The company listed Waymo, Cruise, Tesla Inc. and Apple, among others, as competitors in self-driving. Uber warned investors about the potential impact to a key part of its existing business: “our autonomous vehicle strategy [may] add to Driver dissatisfaction over time, as it may reduce the need for Drivers.”
The phrase “hope for the best and expect the worst” is synonymous with cautious optimism. But with corporate earnings season kicking off, stock investors are forgetting the part about being cautious, setting themselves up for a big disappointment if things don’t break just right.
BOND BEARS CAPITULATE — AGAIN
It seems like such a long time ago, but it was only last fall when 10-year Treasury yields broke through the psychologically important 3 percent barrier to reach as high as 3.26 percent. Many market pundits declared the start of a long, painful bear market in bonds that would send yields even higher. Of course, that didn’t happen, and yields have since fallen back, to around 2.50 percent on Thursday. Now, many of those same pundits don’t expect yields to crack the 3 percent barrier in the next two years, based on the latest forecasts of economists and strategists in a Bloomberg News survey released Thursday. That marks a huge reversal from November, when yields were expected to rise to 3.55 percent as soon as mid-2020, compared with 2.80 percent in the latest survey, which was down from 3 percent in last month’s poll. The reason this is important is that the big sell-off in stocks in the last two months of 2018 was partly blamed on higher yields. The Federal Reserve eventually recognized this and quickly turned dovish in early 2019 out of fear that a collapsing stock market might cause a marked slowdown in the economy or even a recession. One side benefit is lower home-loan rates. Freddie Mac said Thursday that the average rate on a 30-year mortgage stands at 4.12 percent, down from last year’s high of 4.94 percent in November.
The International Monetary Fund just uncorked a sobering outlook on the global economy and asset markets for the elite billionaires huddled up in Davos, Switzerland for the World Economic Forum to ponder.
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