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Rising Wait Times And Higher Pricing For Uber? It Is Because Mobility Demand Has Hit Peak Levels, Analyst Says

Benzinga Real-time News ·  Sep 22, 2022 15:48

  • Needham analyst Bernie McTernan reiterated a Buy on Uber Technologies, Inc (NYSE:UBER) with a $52 price target.

  • In his 14th Mobility Tracker, wait times and pricing continued to rise, both back up towards peak levels, which he thinks is driven by a continued rise in demand, specifically the post-Labor Day return to work, and a lagged reaction by supply.

  • Also Read: Uber System Breach Culprits Are Likely The Ones Behind Microsoft, Nvidia And Okta Hack

  • He believes this environment supports Uber and Lyft, Inc (NASDAQ: LYFT) (reiterated Hold) estimates and feels good about raising his 3Q bookings estimates in his last tracker two weeks ago.

  • However, he reduced his LYFT estimates for 4Q22, assuming a more normal seasonal uplift, which is already contemplated in his Uber forecast.

  • Strategically, he believes Uber will benefit from reopening the economy in Mobility.

  • In Delivery, he thinks Uber can grow its share of bookings by expanding into new verticals with a buy-over-build strategy that allows for quick penetration. He foresees the company's Mobility business benefiting from its Uber Pass subscription.

  • He also thinks the company's subscriptions would benefit from a more aggressive pursuit of acquisitions.

  • Last month, McTernan highlighted Uber's lead in the ride-hailing business on pandemic recovery.


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