Traders are finally realizing the value of companies like Uber and Lyft, Russian rival says

Key Points
  • Yandex, one of Russia's largest internet companies, runs its own ride-hailing company called Yandex.Taxi.
  • The company's finance chief says that the market is starting to realize the value behind ride-sharing firms.
  • Uber recently reported results, and Wall Street analysts have since become much more bullish on the stock.
Market is starting to realize value of ride-sharing firms: Yandex CFO

Investors are starting to understand the value of ride-sharing companies like Uber and Lyft, despite ongoing concerns about their ability to generate a profit, the finance chief of one of Russia's biggest internet companies said.

"What the Uber and Lyft trading performance is telling us is the market's kind of starting to realize the value of the technology that goes into building these marketplaces," Yandex CFO Greg Abovsky told CNBC's Geoff Cutmore Thursday.

Yandex runs its own ride-hailing company called Yandex.Taxi, which Uber owns a stake in.

The Fearless Girl statue is seen in the foreground as a banner announcing the IPO of Uber Technologies hangs outside the New York Stock Exchange, May 10, 2019.
Andrew Kelly | Reuters

Uber's share price recently returned to its initial public offering price of $45, a sign of progress in the company's life as a listed company after it had initially sunk well below that value shortly after the start of trading.

That initial decline was on the back of concerns about a potential  lack of profitability in ride hailing firms — Uber warned in its IPO filing that it may never become a profitable company.

But the firm recently posted its first earnings report since becoming a public company. The company reported results largely in line with expectations, and Wall Street analysts have since become much more bullish on the stock. Lyft's share price also rose after Uber's financial report.

Abovsky said that the financials were a stepping stone in helping market watchers understand the differences between Uber and its domestic rival Lyft.

"What people have realized is that the competitive dynamics between the two won't always be this intense, that over time it will subside."

He added: "What will all of a sudden materialize is that you have two very large, very established players providing very unique services."

Yandex is 'wide open' to partnerships globally, CFO says

Speculation has grown over whether Yandex.Taxi itself will eventually launch an IPO, but Abovsky said that, for the meantime, Yandex is focused on "head-down execution."