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Brett Arends's ROI: Sorry, bears, Uber’s bad IPO has nothing to do with the company’s future success

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Think the Uber and Lyft IPOs have been flops? This is nothing.

Facebook’s FB, +3.45% initial public offering was way worse.

Stock in Mark Zuckerberg’s social-media company halved after it went public in 2012. The fiasco was so bad, the head of Nasdaq issued a public apology. Accusations and lawsuits flew. At one point the Securities and Exchange Commission got involved.

Facebook’s stock, which went public at $38 a share, fell below $18. And, yes, the bears said it was going lower. Some widely followed commenters said it was worth only $15.

The price today? Er, $180. Oops.

So much for the bears.

IPO predictive power

Kathleen Smith, a partner at IPO specialists Renaissance Capital, says that, in the long term, the effects of a bad IPO on a company’s performance are somewhere between minuscule and nonexistent.

“In the long run, we don’t see predictive power for future performance from an IPO that drops below its initial price,” she said. Renaissance runs an exchange traded fund (ETF) that focuses on newly public companies, the Renaissance IPO ETF IPO, +1.37%

Funny: It seems like only last week that Uber UBER, +4.56%  and Lyft LYFT, +8.55%  drivers were going on strike, complaining that stockholders were making too much money from them too easily.

Wait, it actually was last week.

The stocks since then: Down about 11% and 16%.

Presumably the drivers are all now online, buying the stocks at a discount, right?

At the bottom line, both companies are still losing money. Lyft suffered operating losses of $1 billion last year, and Uber $3 billion. So claims that they are profiteering look a little premature.

Bull case

But the bull case for those battered stocks is pretty strong.

Uber and Lyft aren’t going away. And they’re growing like crazy. Gross bookings on

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