Market Overview

PreMarket Prep Stock Of The Day: Uber Technologies

PreMarket Prep Stock Of The Day: Uber Technologies

Benzinga's PreMarket Prep airs every morning from 8-9:00 a.m. EST. During that fast-paced highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action for the upcoming session.

On any given day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick along with producer Spencer Israel.

For those who don't have the time to tune in live or listen to a recording, Benzinga will highlight a stock of the day that was featured on the show.

Stock Of The Day: Uber

What a difference one quarter can make for Uber Technologies (NYSE: UBER). After getting pummeled on Nov. 5 (falling from $31.08 to $28.02) following its fourth-quarter report, it continued lower before making a new all-time low at $25.58 the next day.

The day earnings were released just happened to coincide with lock-up expiration of shares for investors. Ahead of expirations, traders may sell short the issue ahead of the date in anticipation of more shares flooding the market. In the case of Uber and its prolong slide off its IPO, there were high expectations that the issue would move even lower.

Although the issue ended the session lower, it did settle well off its low, giving bottom-pickers a level to lean on if taking a long position. As it turns out, that low was never revisited and the issue embarked on a major rally.

Goldman Sachs Throws In The Towel

During that stealth rally off the low, it was reported on Jan. 15 that Goldman Sachs had liquidated its entire stake in the company. Interestingly, at around that same time, it was mentioned on the show that there was a huge offer over 500,000 shares at $35 in the NYSE open book.

It can't definitively be said that was actually Goldman Sachs offer to exit the issue, but it did happen to coincide with the news of them exiting their stake in the company.

Moving Forward

After the close on Thursday, the company reported a first-quarter EPS beat along with an adjusted sales beat of $339 million. The CEO expects 2020 will be "the year of subscriptions" for ride-hailing and eats business.

Early in the session, the issue had no problem chewing through the institutional sell-orders at $40 and throughout the $40 handle, so far reaching $40.54. That high coincides with its Aug. 8 of $40.68. If the issue can clear that area on a closing basis, there is limited resistance on the daily charts until its Aug. 8 high ($43). The all-time high for the issue was made June 28 at ($47.08).

For those investors, not trying to pick a top but are content with exiting on weakness, a breach of its current intra-day low ($38.66), would put the issue in an area of limited daily support.

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