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Michael97
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Hi Michael, thanks for your question. 

Yes indeed, Uber reported its quarterly earnings yesterday. Uber reported a greater loss than expected. It lost $1.70 per share compared to $0.83 per share expected from the market, which translates into a nearly $3 billion loss for the quarter, which is incredible. 

Still, the stock price ended 6% higher on the day. One of the reasons why Uber stock price gained is that Uber Eats - the company’s food delivery service - reported a 54% growth for the quarter. Revenue was reported in line with the market expectations at $3.54 billion, which represents a 14% increase compared to a year ago. 

Overall, Uber needs to get its business in order and stop losing billions of dollars every quarter. Its Eats unit is doing really well, which should help the company offset losses from the main ride-hailing business. 

The median price target for the Uber stock is $40, which is around 20% higher than the current market price of $32.79.

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Hi Michael, thanks for coming here. 

Uber has recently provided an update that the ride-hailing sector has started to recover as the number of bookings has been increasing. Bookings are now down about 70% compared to a year earlier, which is better than a drop of 80% registered in April.

"Our early hypothesis was that the use case of people going back to work will be the leading use case, and we saw some signal there. But actually, the return is pretty broad. Party hours in a lot of these markets. People want to get out again safely, where they want to get out again, they want to socialize again and kind of get as much as they can their prior lives back," said Chief Executive Officer Dara Khosrowshahi.

The recovery has been led by Hong Kong, where the ride-hailing business has already recovered 80% compared to pre-corona levels. 

As we expect the ride-hailing sector to continue to recover in the coming weeks as more and more countries are lifting lockdown measures, we also expect Uber stock to continue pushing higher. 

As noted in one of the previous answers, Uber stock is up 150% from the lows and now only 10% from the pre-corona highs around the $42 mark. I expect the buyers to eventually take out the 2020 high and set fresh highs above the $42 handle. 


 

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Hi Michael, thanks for your question about Uber stock. 

It seems that the ride-hailing business is recovering now, after being heavily hit by the COVID-19 outbreak and social distancing measures. Uber stock gained around 20% in May due to a few different reasons:

- Higher-than-expected quarterly results

- Recovering ride-hailing industry

- Recovery in the wider stock market as the countries and economies reopen again

Uber’s reported bookings were $15.78 billion, higher than the average analyst's bookings forecast of $15.27 billion. Revenue was also higher, coming in at $3.54 billion, compared to the average target of $3.37 billion. However, the earnings came in much worse than expected due to increase in costs. 

Shares of Uber turned lower this week as the buyers seem to have taken a step back to consolidate recent gains. Remember, Uber stock price gained 150% since the March lows. Therefore, we may see a pullback first before the bulls are able to extend the uptrend higher.

I hope this answer was helpful.


 

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Thanks Michael for a great question.

Uber stock is experiencing a turnaround as the business fights to make profits. Despite its $0.59-per-share gains in 2018, it lost $5.04 a share the following year. Similarly, this year’s Q1 results were worse than expected. Instead of $0.83, the taxi service missed $1.70 per share, making the total quarter loss nearly $3 billion. Uber even reported a 14% staff reduction to minimize operating costs.

But all is not lost. The stocks climbed by 6% thanks to Uber Eats, the service’s food-delivery branch, that recorded a 54% improvement for the quarter. The food unit will come in handy to redeem company shares seeing the stay-at-home Coronavirus directive has hampered the cab business. Its Uber Health feature is equally promising, with its YoY exceeding 200%.

Moreover, the stock could rise further after lockdown measures are lifted. However, the return to normalcy presents new challenges. For instance, Uber increases congestion, a problem every city wants to solve.

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Hi Michael, thanks for coming here.

Shares of Uber Technologies Inc. (NYSE: UBER) plunged 10.7% today after the company failed to take over Grubhub, due to antitrust concerns. Dutch online food ordering company Just Eat Takeaway N.V. will acquire Grubhub instead. 

Before the stock declined, shares of the ridesharing company almost tripled from March, when the stock collapsed. While losing the bid to acquire Grubhub is a big deal, an even bigger problem is the current COVID-19 crisis and the struggling economy. Uber will keep losing millions of dollars until the economy normalizes. 

“The deal was seen as a way to bolster a part of Uber’s business that executives see as crucial to growth and eventually to turning a profit. The coronavirus pandemic is driving a surge in demand for food delivery as many restaurants keep dining rooms closed and people are spending more time at home. The virus is also decimating Uber’s main business of ride hailing, resulting in mass job cuts at the company,” reports Bloomberg.

Uber’s ride-hailing operations have suffered a big blow by the epidemic, sending rides down 80% in April, on a global level. The recovery process has been very slow and further safety concerns would slow it down even more.  

Wedbush analysts Daniel Ives and Ygal Arounian said the failed deal between Uber and Grubhub is a “clear negative” for Uber as its rivals will keep moving forward. Still, they rated the stock at “outperform” with a $47 price target.

Hope that answered your question.

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