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Friday, October 30, 2020

Investor Confidence is Falling for Uber Technologies Inc. (NYSE:UBER)

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Uber Technologies Inc. (UBER) shares are trading at lower $33.35 and the avg recommendation for the stock is Strong Buy, while the current analyst price target stands at $41.51.

To add more color to this target, the company’s high over the last year is $41.86 and the low is $13.71. Over the last 52 weeks, UBER is up 5.27% while the S&P 500 is up 8.70%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, UBER reported a profit of $989.0 million. Uber Technologies Inc. also saw revenues increase to $2.24 billion. In addition, UBER has free cash flow of -$1.9 billion as of 06-2020. The company’s EBITDA came in at -$1.18 billion which compares well with its peers.

UBER booked profit margins of -51.00%, its Return on Equity (ROE) is -55.60%, and its Return on Assets is -22.80%. All told, it is clear that, UBER needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. UBER has a short ratio of 1.99 and outstanding shares of 1.74B.

Company Outlook

UBER has seen increased volume after this news and investors are putting their support behind the value proposition. Furthermore, 10-day volume stands at 28.55 million and more growth is possible in the weeks ahead. Traders will also note the company’s earnings per share came in at -4.03. Uber Technologies Inc. UBER also noted assets of $28.24 billion at the end of the last quarter. Investors should also keep an eye on sector updates as UBER has historically followed its peers on positive news.

All told, Uber Technologies Inc. UBER has strung together solid data and demonstrated underlying fundamentals. At its current valuation, UBER represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

Uber Technologies Inc. UBER is now commanding a market cap of 58.36B and a float of 1.63B. UBER is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of UBER stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in UBER, either long or short, and we have not been compensated for this article.

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