Uber, the ride-hailing giant, recently announced solid third-quarter earnings, leading to a positive impact on shareholders. The stock rallied for weeks leading up to the report, resulting in a 27% increase in stock price since late October and reaching its highest point since mid-2021, closing at $51.58. The company now boasts a market capitalization of nearly $106 billion. However, despite these positive results, longtime shareholders may feel they could have achieved better returns on their investment.

Had Uber not allocated a significant number of shares to employees and other stakeholders, the stock price could potentially be above $60. Since its initial public offering in 2019, the number of outstanding shares has grown by 22%, from 1.695 billion to 2.06 billion. To put it in perspective, it’s akin to a scenario where a portion of joint equity in a house is given to someone else, potentially diminishing the return on investment when selling the property. While it may seem unfair to compare the two situations, it underscores the impact of stock compensation on long-term public shareholders.