Needham maintains Buy rating, $90 target on Uber stock

On Thursday, Needham analysts maintained their optimistic stance on Uber Technologies Inc . (NYSE: NYSE:UBER), reiterating a Buy rating alongside a steady price target of $90.00. With the stock currently trading at $64.48 and analyst targets ranging from $68 to $115, InvestingPro analysis suggests Uber remains undervalued relative to its Fair Value. The endorsement comes after Uber’s recent fourth-quarter earnings release, which prompted Needham to slightly increase their adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) estimates for the ride-hailing giant.

The analysts at Needham highlighted Uber’s response to the ongoing autonomous vehicle (AV) debate, noting the company’s structural commentary and guidance. Despite the ongoing uncertainty and expected continuation of the AV discussion, Needham believes Uber has taken appropriate measures to address the topic. InvestingPro data shows Uber maintains a GOOD Financial Health Score of 3.0, suggesting strong operational fundamentals.

Uber’s current focus appears to be on enhancing affordability in its core services, both in Mobility and Delivery segments, as it competes with its 2024 estimated bookings growth acceleration. This strategy appears to be working, with revenue growing nearly 18% over the last twelve months to $44 billion, while generating $3.56 billion in EBITDA. Needham’s stance suggests confidence in Uber’s strategic direction and potential for financial performance improvement.

The reiteration of the Buy rating and the $90 price target indicates Needham’s view that Uber’s stock has the potential to reach their target based on the company’s adjusted profitability projections and strategic initiatives. Uber’s efforts to emphasize affordability are expected to play a key role in driving the company’s growth in the coming year.

Investors and market watchers will be keeping a close eye on Uber’s progress in the competitive ride-sharing and delivery markets, as well as its its involvement and positioning in the ongoing autonomous vehicle technology debate. While trading at relatively high EBIT and EBITDA multiples, Uber’s actions and performance in these areas will likely continue to influence analyst ratings and investor sentiment. For deeper insights into Uber’s valuation and growth prospects, access the comprehensive Pro Research Report available exclusively on InvestingPro.

In other recent news, Uber Inc. has seen a series of changes in stock price targets from various analyst firms. Citi reduced the price target to $92 from $98, citing Uber’s growth in various performance metrics for the fourth quarter of 2024, including an 18% increase in trips and a 14% growth in Monthly Active Platform Consumers. Meanwhile, Wolfe Research lowered the target to $80 from $92, highlighting Uber’s aggressive spending focused on driving top-line growth.

On the other hand, BofA Securities raised its price target to $95 from $93 following Uber’s recent earnings report, which revealed bookings of $44.2 billion and revenue of $12.0 billion, surpassing Wall Street’s expectations. BTIG also adjusted the price target for Uber shares to $90 from $95, noting strong demand for both Mobility and Delivery services.

Evercore ISI, however, lowered its price target from $120 to $115, citing a modest reduction in estimates following Uber’s latest quarterly earnings report. Despite the mixed views on Uber’s stock price target, all firms maintained a positive rating on Uber’s shares, reflecting confidence in the company’s strategic positioning for future benefits. These are recent developments in Uber’s financial journey.

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