Street Calls of the Week
On Tuesday, Piper Sandler adjusted its outlook for Uber Inc. (NYSE: UBER), reducing the price target from the previous $98.00 to $82.00. The firm maintained its Overweight rating on the ridesharing company's shares, which currently commands a market capitalization of $144.8 billion. The revision reflects a recalibration of the gross bookings estimates for Uber's Mobility division, starting from the fiscal year 2026. This change is due to the anticipated market share loss to autonomous vehicle (AV) technologies, such as those developed by competitors like Waymo. According to InvestingPro data, Uber maintains strong financial health with an overall score of "GREAT" and has demonstrated profitability over the last twelve months.
The firm's analysts have expressed that the investor community is particularly attuned to any signs of weakness in Uber's Mobility results. In response to these market conditions, Uber recently initiated an Accelerated Share Repurchase (ASR) agreement. Piper Sandler sees this move as a pragmatic approach amidst the current financial landscape. While potential mergers and acquisitions (M&A) activity has been a topic of discussion, the firm's stance on Uber remains positive, citing the company's leadership position in the market.
Despite maintaining an overall bullish perspective, Piper Sandler has reduced its Mobility gross bookings projections by 1%, 3%, and 4% for the fiscal years 2026 through 2028. This adjustment is a precautionary measure to account for the potential impact of AV penetration in the ridesharing market. Analysts at Piper Sandler speculate that by 2026, Waymo could achieve approximately 1% penetration, which warrants a conservative approach to future estimates.
The report also acknowledges the challenges Uber faces due to the strengthening of the dollar, which adds to existing foreign exchange (FX) obstacles. However, the analysts anticipate that the second half of 2025 will present favorable comparative results, which could mitigate some of the current concerns over AV competition. Piper Sandler's revised price target reflects these varied factors, as they continue to monitor Uber's performance and market dynamics.
In other recent news, Uber Technologies Inc . (NYSE:UBER) has been the focus of several key developments. Cantor Fitzgerald analysts maintained an Overweight rating on Uber and increased the price target to $80.00, up from the previous target of $75.00. The firm anticipates a stable performance for Uber in the near future. Additionally, Goldman Sachs maintained a Conviction Buy rating on Uber with a price target of $96.00, while Needham reiterated its Buy rating on Uber with a price target of $90.00.
In a significant change, the New York City Taxi and Limousine Commission withdrew a proposed rule change requiring taxi and rideshare drivers to have coverage from a "solvent and responsible" insurance carrier, following Uber's caution that this could potentially leave thousands of drivers uninsured.
Uber has also expanded its grocery delivery services through a partnership with Wegmans Food Markets, Inc. and announced a strategic partnership with Nvidia Corp (NASDAQ:NVDA) to expedite the development of autonomous driving technology. Moreover, Delta Air Lines (NYSE:DAL) ended its partnership with Lyft (NASDAQ:LYFT) in favor of Uber, allowing Delta's SkyMiles loyalty program customers to earn miles through Uber rides and deliveries. These are the latest developments in Uber's strategic efforts to expand markets, improve profitability, and boost investor returns.
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