On Monday, Tigress Financial Partners increased its price target for Uber Inc. (NYSE: NYSE:UBER) to $103.00, while maintaining a Buy rating. The firm highlighted Uber's sustained strong ridership demand and continuous innovation and partnerships as key drivers of incremental growth. According to the firm, these factors are expected to further enhance the company's already dominant position in ride-sharing and delivery services.
Uber reported a 20% year-over-year increase in Q3 2024 revenue, reaching a record $11.2 billion, with a 22% rise in constant currency. The company's Gross Bookings grew by 16% year-over-year, or 20% in constant currency, to a record $41.0 billion. Monthly Active Platform Consumers (MAPCs) saw a 13% year-over-year increase to 161 million, and the number of trips rose by 17% to 2.9 billion, averaging 31 million trips per day.
The ride-sharing giant also reported a 14% year-over-year increase in drivers and courier aggregate earnings, which amounted to $18.1 billion, or a 21% increase in constant currency. Uber has introduced over 20 enhancements to improve the experience for earners, including the nationwide launch of enhanced Rider verification and a redesigned Uber Driver app. The company's strategic expansion includes a deepened partnership with Alphabet (NASDAQ:GOOGL)'s Waymo, extending autonomous ride-hailing services to Austin and Atlanta.
Uber has also announced new autonomous partnerships in Mobility and Delivery with five different companies, and launched Uber One for Students. The company's pilot of the First Impression ad format represents a push into digital advertising, allowing advertisers to feature new products or offers prominently on the app's home feed.
Tigress Financial Partners underscored Uber's potential for growth in less populated markets, geographic expansion, and the increasing adoption of Transportation as a Service (TaaS). The firm anticipates that Uber's industry leadership, investment in research and development, and strong brand equity will continue to accelerate business performance trends and increase economic profit, thus creating long-term shareholder value.
Uber's commitment to returning excess cash to shareholders was evidenced by the repurchase of $372 million worth of stock in the most recent quarter. The firm's $103 price target suggests a potential return of over 40% from current levels.
In other recent news, Uber Inc. has experienced a series of noteworthy developments. The company's third-quarter earnings report showed a robust performance, with EBITDA reaching $1.69 billion, surpassing expectations. Advertising revenues saw a significant increase of 80%, and Delivery services grew by 17%. Uber's subscription service, Uber One, experienced a substantial year-over-year increase, reaching over 25 million members.
Analysts from various firms, including Citi, Loop Capital, DA Davidson, Seaport Global Securities, Goldman Sachs, BofA Securities, and Evercore ISI, have maintained a positive outlook on Uber, adjusting their price targets accordingly. Citi, in particular, highlighted the potential for growth in Uber's Mobility and Delivery Gross Bookings (GBs) and the evolving autonomous vehicle (AV) strategy as key factors.
In a landmark decision, Massachusetts voters passed a measure allowing ride-share drivers from companies such as Uber to form unions, making Massachusetts the first U.S. state to allow such collective bargaining. This development marks a significant shift in the rights of ride-share drivers.
InvestingPro Insights
Uber's strong performance and growth potential highlighted in the article are further supported by real-time data from InvestingPro. The company's revenue for the last twelve months as of Q3 2024 stood at $41.95 billion, with a robust revenue growth of 16.7% over the same period. This aligns with the 20% year-over-year increase in Q3 2024 revenue mentioned in the article.
InvestingPro Tips suggest that Uber is expected to grow its net income this year, which is consistent with the company's improving financial performance described in the article. Additionally, Uber is trading at a low P/E ratio relative to its near-term earnings growth, indicating potential undervaluation despite its recent stock price appreciation.
It's worth noting that Uber's EBITDA growth for the last twelve months as of Q3 2024 was an impressive 197.24%, reflecting the company's ability to scale its operations efficiently. This substantial growth in EBITDA supports Tigress Financial Partners' optimistic outlook on Uber's future performance and its $103 price target.
For investors seeking more comprehensive analysis, InvestingPro offers 12 additional tips for Uber, providing a deeper understanding of the company's financial position and market standing.
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