Uber Stock Gains as Jefferies Reiterates “Buy” Despite AV Concerns

Uber Technologies' stock price (UBER) is edging higher today, buoyed by a reaffirmed “Buy” rating from Jefferies, despite ongoing market discussions surrounding the future impact of autonomous vehicles (AVs). Uber's stock is currently trading at $86.33, a gain of 0.94% on the day.

The increase comes as the stock attempts to break free from a downward trend that began in early November. Jefferies analyst John Colantuoni believes that concerns about autonomous vehicles have unduly pressured Uber's stock, causing a 17% decline since late September.

Colantuoni draws parallels to a similar period last year when AV anxieties preceded a roughly 70% rally in the stock's value, suggesting a potential buying opportunity. Jefferies maintains a price target of $120, signaling considerable upside potential from current levels.

Contrasting this positive outlook, Melius Research recently downgraded Uber to a “Sell” rating with a $73 price target. Their assessment highlights intensifying competition in the AV sector as a potential threat to Uber's market dominance, despite the company's leading position in ridesharing and delivery. Melius anticipates increased AV competition from 2026 onwards, which could erode returns irrespective of Uber's AV partnership strategy.

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Uber's strategic initiatives in the AV space include a partnership with NVIDIA to deploy a large network of autonomous vehicles powered by NVIDIA's AI architecture. Additionally, Uber has partnered with Stellantis to receive at least 5,000 Level 4 autonomous vehicles for robotaxi operations both in the U.S. and internationally. This collaboration is designed to solidify Uber's position in the AV market.

However, competition is fierce. Waymo, owned by Alphabet Inc., has reported serving over 1 million fully driverless rides monthly since the spring, with goals to achieve that milestone weekly by the end of 2026. This advancement poses a challenge to Uber's future market share in autonomous ride-hailing.