Please ensure Javascript is enabled for purposes of website accessibility

Why Uber Stock Fell Today

By Evan Niu, CFA - Feb 27, 2020 at 12:26PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The ridesharing company continues to face legal challenges, and the coronavirus outbreak is rattling investors.

What happened

Shares of ridesharing giant Uber Technologies (UBER 0.06%) have fallen today, down by 5% as of 11:40 a.m. EST, following some ongoing setbacks in Europe. The broader market is also selling off due to fears surrounding the escalating coronavirus outbreak.

So what

Uber lost its license to operate in London back in November, which the tech company is in the process of appealing. The court has now decided to allow the Licensed Taxi Drivers' Association to participate in the case as an interested party, according to Reuters. That will give the organization, which opposes Uber, the ability to make submissions, as well as access documents, potentially making Uber's appeal more difficult.

Uber and Uber Eats apps on a phone

Image source: Uber.

Separately, European Union antitrust chief Margrethe Vestager told Bloomberg that she is exploring ways to help drivers get better working conditions and higher wages. Vestager wants to make it easier for freelancers and self-employed contractors to unionize.

Now what

The developments underscore the challenges and criticisms that Uber has long faced in its ridesharing and food delivery business. The company is currently embroiled in a legal battle in its home state of California, which recently passed a gig economy law designed to help contract workers.

Meanwhile, risks associated with the coronavirus outbreak are reverberating throughout the market, triggering a broad sell-off that is impacting tech stocks with lofty valuations in particular. The epidemic could also hurt demand for ridesharing services as consumers around the world travel less to mitigate potential exposure to the disease.

The first patient diagnosed with the coronavirus in London earlier this month took an Uber to the hospital.

Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool recommends Uber Technologies. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Uber Technologies, Inc. Stock Quote
Uber Technologies, Inc.
UBER
$32.49 (0.06%) $0.02

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
400%
 
S&P 500 Returns
128%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/16/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.