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On Tuesday, JPMorgan analyst Doug Anmuth announced an increase in the price target for Uber Technologies Inc . (NYSE: NYSE:UBER) shares to $105 from the previous target of $92, while reaffirming an Overweight rating on the company’s stock. The updated target reflects a positive outlook following discussions with Uber’s top executives during the recent JPM TMC Conference in Boston. The stock, currently trading near its 52-week high of $92.90, has delivered an impressive 53% return year-to-date, according to InvestingPro data, which offers 14 additional investment tips for UBER stock.
Anmuth’s optimistic stance is based on Uber’s management team, including CEO Dara Khosrowshahi and CFO Prashanth Mahendra-Rajah, conveying confidence in meeting or exceeding the company’s three-year goals through 2026. These goals include mid-to-high teens growth in Gross Bookings (GBs), mid-30s to 40% growth in EBITDA, and a 90% conversion of EBITDA to Free Cash Flow (FCF). The company’s current trajectory appears promising, with revenue growing at 17.6% and generating $4.57 billion in EBITDA over the last twelve months. Notably, 8 analysts have recently revised their earnings estimates upward for the upcoming period.
The analyst highlighted Uber’s continued pursuit of profitable growth within its core business operations, alongside strategic investments in long-term growth opportunities. Discussions at the conference covered various topics such as advancements in autonomous vehicle (AV) technology, Mobility pricing trends, insurance aspects, and Delivery segment margins.
A significant point of interest is Uber’s collaboration with Waymo in Austin, which is expected to showcase improved utilization rates and possibly expand in scope. Anmuth anticipates that Uber’s narrative around AV technology will strengthen as it demonstrates early success in Austin and potentially soon in Atlanta. Uber’s role as a partner to AV technology providers is becoming more valuable, according to Anmuth, due to its capabilities as a demand and utilization platform and as a fleet operator, underscored by its recent AI alliances.
The revised price target of $105 set by JPMorgan is based on a 21.0x multiple of the company’s estimated 2026 Free Cash Flow, which is projected to be around $9.8 billion. This new target represents JPMorgan’s confidence in Uber’s strategic direction and its potential for growth in the coming years. Based on InvestingPro’s Fair Value analysis, the stock appears to be fairly valued at current levels, with analysts maintaining a strong buy consensus. For deeper insights into Uber’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, Uber has announced early access to Waymo rides for selected residents in Atlanta as part of a pilot program. This initiative is a precursor to the full launch of Waymo rides in the city, scheduled for later this summer. Meanwhile, Uber has expanded its rental options by partnering with Turo, allowing users to rent peer-to-peer cars through the Uber app across the United States, excluding certain states. This collaboration aims to modernize vehicle access and reduce reliance on traditional car ownership.
On the financial front, Cantor Fitzgerald has reiterated its Overweight rating on Uber with a price target of $96. The firm’s analysis highlights Uber’s consistent product innovation, emphasizing its recent GO-GET event that introduced new features like Price Lock and Savings Slider. Similarly, Citi analysts maintained a Buy rating on Uber, setting a price target of $102. They praised Uber’s new product offerings, which are expected to enhance affordability and convenience for users.
In related developments, Loop Capital Markets increased the price target for Instacart (NASDAQ:CART) shares to $58, maintaining a Buy rating. The firm noted the potential for Uber to acquire Instacart, citing synergies between the companies. Instacart’s strong position in the grocery delivery sector and its advertising business were highlighted as strengths, although the price remains a potential hurdle for a deal.
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