Could Grab's share price go below $5 and become a "penny stock"?

I invested quite heavily into Grab when they went public, and now the price is falling significantly, hovering around $5. Any thoughts on this?

Azzurra Roberto

23 Feb, 2022


1 Answer


Bao Erdody

Hungary

There is that possibility where Grab's share price could definitely fall below $5, though I believe it is more likely that it will rise.

The company can't afford their share price to fall below $5 as if it is classified as a "penny stock", many investors (especially large funds) will lose confidence in the company and potentially pull out.

Grab shares could go up after March 2022:

Grab is scheduled to announce their first quarterly earnings since going public on 3rd March 2022. If growth/revenue figures beat expectations, there's a very high chance the stock will rebound.

Not to mention Temasek recently bought quite a significant amount of Grab's shares, which I believe is to boost/maintain its current share price (and also to get in low).

Grab still has a long way ahead to go as many of their business units are turning profitable (GrabFood, Ride-Hailing), while their other emerging businesses (Grab Financial, Groceries) have yet to fully take off.

With the pandemic coming to an end and ride-hailing expected to recover, there is tremendous potential for Grab's stock to recover and potentially hit levels of SEA Ltd (Shopee/Garena parent).

In conclusion: I'm still very bullish on Grab.


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