Following its third-quarter earnings report, Uber Technologies, Inc. (UBER) faced a wave of analyst reactions, reflecting a mixed bag of performance. While the ride-hailing giant delivered strong revenue growth, surpassing analyst expectations with a 20% increase to $11.188 billion, the results sparked debate among experts.
Several analysts adjusted their price targets and maintained their bullish outlook on UBER, citing the company’s expanding international presence, growth in the Delivery segment, and robust free cash flow potential. JMP Securities analyst Andrew Boone, for example, maintained a Market Outperform rating, raising his price target to $95 from $80, highlighting Uber’s early-stage growth in Mobility and Delivery, especially in regions lacking on-demand services. KeyBanc analyst Justin Patterson also reiterated an Overweight rating, though with a reduced price target of $85 from $90, acknowledging potential moderation in the Mobility segment due to expanding lower-priced services and easing insurance inflation.
However, some analysts expressed concerns about slowing growth in the Mobility segment. Benchmark analyst Daniel Kurnos maintained a Hold rating, pointing to questions about Uber’s growth prospects in ride frequency, particularly in North America. While acknowledging the company’s outperformance on revenue and adjusted EBITDA, Kurnos highlighted the impact of strong competitor results and new market partnerships on Uber’s long-term position.
Despite these concerns, most analysts remain optimistic about Uber’s long-term growth trajectory. Needham analyst Bernie McTernan reiterated a Buy rating, highlighting Uber’s focus on balanced growth through user and frequency increases, and robust capital allocation with buybacks projected at nearly $5 billion in 2025. RBC analyst Brad Erickson also maintained an Outperform rating, emphasizing Uber’s focused expansion into international markets and suburbs, where demand for low-cost rides is high.
The market’s reaction to Uber’s earnings report reflects the complexities of evaluating a rapidly evolving company like Uber. While the short-term performance may be mixed, the long-term prospects remain strong, with analysts pointing to several key drivers of future growth, including international expansion, continued development of the Delivery segment, and the potential of autonomous vehicles. The continued growth of Uber One, the company’s loyalty program, with 25 million members contributing to 35% of total bookings, also highlights the potential for long-term success.
The analyst community’s diverse viewpoints on Uber’s recent performance showcase the dynamic nature of the ride-hailing and delivery market. While some challenges remain, the company’s ongoing innovation, strategic partnerships, and commitment to expanding its reach in new markets suggest a promising future for Uber, even as the company navigates the complexities of a competitive landscape.
