Uber Technologies (UBER) Expands In India, Is The Stock A Bargain?
Uber Technologies (UBER) is back in focus after a fresh client announcement in India. Zoomcar users in Bengaluru, Delhi NCR and Mumbai can now compare self drive rentals with Uber Intercity chauffeur driven options inside one app.
Despite the new partnerships in India, Europe and Dubai, Uber Technologies’ recent share price performance has been mixed, with the stock down over the year on a total shareholder return basis but still showing strong multi year total shareholder returns that suggest momentum has cooled rather than disappeared.
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Uber Technologies now trades well below both analyst targets and some intrinsic value estimates after a weak year on total returns. Is that a margin of safety, or a warning that the market’s caution on Uber is warranted?
Most Popular Narrative: 35.1% Undervalued
According to the most followed narrative on Uber Technologies, a fair value of $116 sits well above the last close of $75.24, which frames a clear valuation gap for investors to assess.
The market is no longer debating whether Uber can become profitable. It is debating who owns the economics of transportation when the driver disappears.
Want to see what underpins that $116 fair value for Uber Technologies? The narrative leans on strong free cash flow, robust profitability and confident long term margin assumptions, plus a specific view on how autonomous partnerships affect those numbers.
Result: Fair Value of $116 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, investors still need to weigh two key pressure points for Uber Technologies: how autonomous partners share economics and whether heavier capital commitments dilute its marketplace model.
Find out about the key risks to this Uber Technologies narrative.
Next Steps
With investors split between concern over risks and optimism around rewards for Uber Technologies, it makes sense to review the numbers yourself and act decisively. To see both sides laid out clearly, start with the 3 key rewards and 1 important warning sign.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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