On Monday, TD Cowen reaffirmed its confidence in Uber Inc. (NYSE:UBER), maintaining a Buy rating and a steady price target of $90.00. The firm's analysis suggests that Uber's third-quarter gross bookings (GBs) for the year 2024 are projected to reach $41.3 billion, marking a year-over-year increase of 17.1%. This figure is slightly below the consensus but hovers near the upper end of Uber's forecasted range of $40.25 billion to $41.75 billion.
The continued growth is attributed to the consistent performance of Uber's Mobility and Delivery services. Additionally, the firm anticipates a significant 47% year-over-year increase in EBITDA, surpassing the midpoint of Uber's guidance. These positive developments have led to a modest upward revision of Uber's long-term gross bookings and EBITDA projections by TD Cowen.
Furthermore, TD Cowen has provided a more detailed outlook by breaking down its quarterly estimates for 2025 and has extended its financial model for Uber up to the year 2034. Despite these updates, the price target for Uber's stock remains unchanged at $90.00.
The analyst's comments highlight the robustness of Uber's core business segments and the company's ability to maintain a strong growth trajectory. The firm's analysis indicates that Uber is well-positioned to continue its upward trend, reinforcing the Buy rating on the stock. Uber's financial performance, particularly in terms of EBITDA growth, suggests a favorable outlook for the company's profitability in the near term.
In other recent news, Uber Technologies Inc . (NYSE:UBER) has been the subject of several analyst reviews and legal challenges. Mizuho Securities maintained its Outperform rating on Uber shares amid potential acquisition talks with Expedia (NASDAQ:EXPE) Group Inc., while Truist Securities reaffirmed its Buy rating despite skepticism about the viability of such a deal. Meanwhile, BMO Capital and Jefferies kept their positive ratings and price targets for Uber, undeterred by Tesla (NASDAQ:TSLA)'s announcement of its Cyber Cab.
The potential acquisition of Expedia could mark a significant expansion into the travel industry for Uber, but complexities involved in integrating the two businesses have been noted. Uber's exploration of growth opportunities beyond its core ride-sharing business, including a possible expansion into the grocery delivery market, has also been highlighted.
Despite facing legal challenges, such as the U.S. Supreme Court's rejection of the company's appeal against California lawsuits alleging misclassification of drivers as independent contractors, Uber continues to innovate and expand. The company has partnered with autonomous technology startups like Avride and established partnerships with Alphabet (NASDAQ:GOOGL)'s Waymo, Chinese firm WeRide, and Darden Restaurants (NYSE:DRI).
These recent developments reflect Uber's resilience and adaptability in the face of a rapidly evolving market landscape. The company's higher free cash flows and a substantial $7 billion buyback program have been recognized as supportive of a higher long-term valuation.
InvestingPro Insights
Complementing TD Cowen's positive outlook on Uber Inc. (NYSE:UBER), recent data from InvestingPro provides additional context to the company's financial performance and market position. Uber's market capitalization stands at an impressive $166.31 billion, reflecting its dominant status in the ground transportation industry.
InvestingPro data shows that Uber's revenue for the last twelve months as of Q2 2024 reached $40.06 billion, with a robust revenue growth of 14.44% over the same period. This aligns well with TD Cowen's projections for continued growth in gross bookings. Furthermore, Uber's operating income margin of 5.03% indicates improving profitability, supporting the analyst's expectations for significant EBITDA growth.
InvestingPro Tips highlight that Uber's net income is expected to grow this year, and analysts predict the company will be profitable. This corroborates TD Cowen's positive stance on Uber's financial trajectory. Additionally, Uber has shown a strong return over the last year, with a remarkable 84.26% price total return, suggesting investor confidence in the company's strategy and market position.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips for Uber, providing a deeper understanding of the company's financial health and market performance.
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