Hello my dears. Opinions on Uber are divided. Goldman Sachs is optimistic and sees the price target at USD 96.
JMP Securities warns of competition from Waymo and Tesla.
What do you think of Uber?
The shares of Uber Technologies have risen in recent days. The company is trying to put a mixed performance in 2024 behind it and attack again in 2025.
The share price has been weighed down by concerns that autonomous vehicles from Waymo (backed by Alphabet) and Tesla could jeopardize Uber's market share. According to Investor's Business Daily (IBD), the share's relative strength rating fell from 82 to 19 in three months.
Analysts divided
Goldman Sachs took an optimistic stance and placed Uber on its Conviction List. In a CNBC interview, analyst Eric Sheridan described Uber as the "best pick of the year".
"Most AV offerings will not reach unit costs that allow direct market entry in the next year or two. However, they could be integrated as an option in the Uber app," Sheridan explained. Goldman Sachs has issued a price target of USD 96, which is a third above the current share price.
Skepticism at JMP Securities
JMP Securities sees risks from the growing competition. Analyst Andrew Boone downgraded Uber to "market perform" and explained:
Waymo is scaling at lightning speed and has almost unlimited access to capital.
He warned that Uber could face significant challenges in adapting to a hybrid marketplace of first- and third-party providers. Boone believes it is likely that Waymo will increasingly act as a competitor in the future. At the same time, relaxed regulations under President-elect Donald Trump could benefit Tesla. Waymo recorded over 175,000 trips per week in cities such as San Francisco and Los Angeles at the end of 2024.
Outlook for the market
A regulatory framework for self-driving cars is expected by 2025, which could further change the dynamics of the market. Analysts are advising investors to keep a close eye on further developments, even if the analyst community has high confidence in the share. The average price potential of Wall Street experts is around 40 percent. However, the price/earnings ratio of 33.71 is no bargain.
