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On Tuesday, Raymond (NSE:RYMD) James reaffirmed its strong confidence in Uber Technologies Inc . (NYSE:UBER), maintaining a Strong Buy rating and a $95.00 price target. The research firm’s stance is anchored in the belief that Uber’s evolving partnership with Waymo and the slow progress in fully self-driving (FSD) technology will pivot the company’s narrative from one of disruption to market expansion. With a market capitalization of $145.8 billion and strong revenue growth of 16.7% over the last twelve months, InvestingPro analysis indicates the company is currently fairly valued, trading at a P/E ratio of 32.7x.
The analyst at Raymond James highlighted the "Robo-rides" thesis, which foresees an increased collaboration with Waymo as a significant factor in this shift. Despite potential headwinds such as unfavorable foreign exchange rates affecting major Latin American currencies and the Euro/Pound, as well as possible impacts from weather and natural disasters on mobility bookings, the firm projects a neutral setup leading into the quarter. As a prominent player in the Ground Transportation industry according to InvestingPro, which offers 10+ additional exclusive insights about Uber’s market position and growth prospects in its comprehensive Pro Research Report.
The commentary on autonomous driving and incremental EBITDA (earnings before interest, taxes, depreciation, and amortization) margins are anticipated to play crucial roles in the company’s narrative. Raymond James expects Uber to display pricing discipline and reap loyalty benefits, which could lead to an EBITDA of $1.8 billion for both the fourth quarter and the first quarter, aligning with the consensus estimates. The firm also projects incremental margins of 9% or higher, indicating room for upside in profitability. Notably, Uber’s EBITDA has already reached $3.445 billion in the last twelve months, demonstrating strong financial execution.
The reiteration of the Strong Buy rating and the $95.00 price target reflect Raymond James’ confidence in Uber’s strategic direction and its potential for growth in the evolving market landscape. The firm’s analysis suggests that Uber is well-positioned to leverage its partnerships and market strategies to drive future success. Get deeper insights into Uber’s valuation and growth potential with InvestingPro, including exclusive financial health scores and detailed peer comparisons.
In other recent news, Uber Technologies Inc. has been the subject of multiple analyst evaluations, a legal dispute, and market reactions to competitor developments. Oppenheimer maintained an Outperform rating on Uber, highlighting the upcoming fourth-quarter results and the potential of Robotaxi technology. Concurrently, Benchmark kept a Hold rating, noting the upcoming earnings report and challenges in the mobility sector. JMP Securities also reiterated a Market Perform rating for Uber, pointing to the increasing competition from autonomous driving technology companies like Waymo.
In a separate development, Uber has filed a racketeering lawsuit against a group of law firms, medical practitioners, and pain-management clinics, alleging insurance fraud through staged car accidents and unnecessary surgeries. Lastly, shares of Uber experienced a decline following Tesla (NASDAQ:TSLA)’s announcement of its upcoming robotaxi plans. These developments highlight the dynamic nature of the ride-hailing industry and the multitude of factors that can influence a company like Uber.
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