Thursday, in an interview with CNBC's Becky Quick, Warren Buffett shared that not only hasn't he bought an IPO since 1955, but he can find something better to invest in than Friday's from ride-sharing service company Lyft Inc. (LYFT) .
Surprising? No. Buffett's portfolio is not one that is heavy on technology or tech service companies, and odds are he sees somewhat low-entry barriers.
Over the long-term as autonomous cars become the norm, my personal bet is we see car rental companies such as Hertz Global Holdings (HTZ) and Avis Budget Group (CAR) alter their business models toward on-demand autonomous cars. But we're at least a few years away from that becoming close to reality.
We've heard reports over the last few days of standing-room-only meetings as Lyft shared how it plans not only to grow the business, but also improve its profitability by tackling costs, including insurance costs.
Here's my two cents: I tend to avoid IPOs until the lockup expiration has come and gone. As far as Lyft in and of itself, I like the disruptive nature of the business and truth be told, as a consumer, I've had nothing but a good experience.
If I were to listen to investing legend Peter Lynch that would be enough, but IPO lockup aside, I'd need to see where the transaction starts trading to determine if enough upside exists.
One thing we can say is if the post-IPO reception for Lyft is similar to that for Levi Strauss & Co. (LEVI) , which is currently trading at about $22 after seeing the price raised to $17, we are likely to see the recent wave of IPOs filings, which include Pinterest and video-conferencing company Zoom, continue.
Indeed, it will be interesting to see how the Lyft IPO goes considering Stocks Under $10 position in GSV Capital Corp. (GSVC) , which counts Lyft among its top-10 investments. Over the last year, two of GSV's big holdings, Dropbox (DBX) and Spotify (SPOT) went public. With each IPO, we've seen GSV's net asset value per share, the real driver of the GSVC share price, move higher.
And while all eyes are focused on Lyft now, there is some other positive news in GSV's portfolio. Its largest position, in data analytics company Palantir, has inked an $800-million dollar contract with the U.S. Army.
This commentary was originally sent to subscribers of Real Money Pro and TheStreet's Stocks Under $10 portfolio. Click here to learn more about this portfolio, trading ideas and market commentary product.
Chris Versace and Stephen "Sarge" Guilfoyle are co-portfolio managers of Stocks Under $10.