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On Thursday, Wolfe Research adjusted its outlook on Uber Inc. (NYSE:UBER) by reducing the price target to $80 from the previous $92, while maintaining an Outperform rating on the company’s shares. According to InvestingPro data, Uber’s market capitalization stands at $135.8 billion, with the stock currently appearing undervalued based on Fair Value analysis. The research firm’s analysts highlighted that Uber’s recent spending was aggressive and focused on driving top-line growth rather than merely defending its market share, which has helped achieve an impressive revenue growth of 18% over the last twelve months.
The analysts noted that Uber’s core business metrics remain stable, with management expressing confidence in achieving over 20% growth in Mobility Bookings, excluding foreign exchange impacts, for the first half of 2025. This projection suggests an increase from the initial high-teens to a new low-20% target. Additionally, Uber anticipates a 30-40% compound annual growth rate (CAGR) in EBITDA over the next three years. The company’s current EBITDA stands at $3.56 billion, with a healthy gross profit margin of 33.2%.
The commentary from Wolfe Research also pointed to the current robust state of consumer health, which is seen as a positive sign for Uber. Moreover, the expectation is for insurance costs to moderate in the future, which could further support the company’s financial performance.
The analysts also welcomed Uber’s enhanced transparency regarding its autonomous vehicle (AV) initiatives. This greater level of disclosure is viewed as a positive development, as it provides investors with more detailed information about this key area of technological advancement and potential growth for the company.
In summary, Wolfe Research’s updated price target reflects a nuanced view of Uber’s strategic spending and its potential to fuel growth, balanced against the backdrop of a solid fundamental outlook for the company.
In other recent news, various financial firms have updated their outlooks on Uber Technologies Inc . following its latest earnings report. The report revealed bookings and revenue figures that surpassed Wall Street’s expectations. BofA Securities raised its Uber price target to $95, citing the company’s strong growth, while BTIG cut its price target to $90 but maintained a Buy rating. Evercore ISI lowered its Uber stock price target to $115, and both Mizuho (NYSE:MFG) Securities and Canaccord Genuity maintained their price targets at $90, all continuing to express confidence in the company’s performance.
The recent financial disclosures showed Uber’s Mobility and Delivery services continue to exhibit strong demand, with the company performing at the upper end of its growth and margin forecasts. However, growth investments have led to some softening in Uber’s Mobility margins. Analysts have also noted Uber’s strategic growth initiatives, including its subscription service, rides for teenagers, and corporate travel solutions.
Despite some short-term headwinds, the firms’ analysis suggests that Uber’s strategic initiatives and market positioning bode well for its future growth and profitability. The analysts also highlighted the dual nature of autonomous vehicles as both a significant risk and opportunity for Uber. These are the latest developments in the company’s ongoing growth and expansion efforts.
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