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On Thursday, Benchmark analyst Daniel L. Kurnos maintained a Hold rating on Uber Inc. (NYSE:UBER) despite the company’s first-quarter earnings revealing a slight miss in gross bookings and revenue. With a market capitalization of $173.28 billion and impressive revenue growth of 18% year-over-year, Uber continues to show strong momentum. Kurnos pointed out that the miss came exclusively from the mobility division, although the growth in monthly active platform consumers (MAPC) and trips met forecasts and even exceeded expectations. According to InvestingPro data, the company maintains a "GREAT" financial health score of 3.48 out of 5.
Uber’s stock experienced a minor decline after the announcement, trading at $82.76, which occurred amid a generally strong market performance. The analyst highlighted Uber’s strategic focus on membership and cross-pollination, which could give the company a considerable customer acquisition cost (CAC) advantage in a highly competitive market. InvestingPro subscribers can access 12 additional key insights about Uber’s market position and growth potential through exclusive ProTips.
Kurnos also noted that Uber is positioned to benefit from easier comparisons in the upcoming quarters and the potential increase in user frequency, based on past cohort analyses. He mentioned that Uber’s shares are not necessarily inexpensive, but argued that there might be a case for an undervalued delivery business, especially considering the strides made in profitability, market reach, total addressable market (TAM), and the largely untapped advertising market.
The analyst expressed caution due to the crowded nature of the trade and the highly optimistic sentiment surrounding Uber, suggesting that any unexpected deviation from anticipated results could introduce additional volatility to the stock. Despite this, Kurnos acknowledged the company’s strong second-quarter guidance and the potential for continued performance improvements.
In other recent news, Uber Technologies Inc . reported its first-quarter earnings, which showed a solid performance with revenue aligning closely with estimates and EBITDA surpassing consensus projections by 1%. Despite a slight miss in Mobility Gross Bookings, the company’s Delivery segment showed strength, contributing to overall positive results. Analysts responded favorably, with TD Cowen raising Uber’s price target to $96, RBC Capital Markets increasing it to $94, and Cantor Fitzgerald lifting it to $96, all while maintaining positive ratings. Truist Securities reiterated its Buy rating with a $92 target, acknowledging the company’s robust demand in both Mobility and Delivery sectors despite some pricing challenges.
Bernstein also maintained an Outperform rating with a $95 target, noting stable performance in Mobility and acceleration in Delivery volumes. Analysts highlighted Uber’s strategic moves in autonomous vehicle technology, with partnerships and advancements seen as potential growth catalysts. RBC Capital specifically noted Uber’s collaborations with Waymo as promising developments. Analysts generally expressed confidence in Uber’s growth drivers and business fundamentals, indicating potential for sustained growth in the coming quarters.
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