UBER - After a Terrific Quarter Does Uber Deserve a Spot in Your Portfolio?
When it comes to ride-sharing, there are only a handful of options such as public transportation services like buses, metros, or trains. These options often require commuters to stand around and wait for their ride. Uber Technologies (NYSE: UBER) recognized this disconnect and created a one-stop shop for commuters to hail a ride on demand. The convenience factor and some savvy marketing allowed Uber to raise billions of dollars in venture capital as a private company.
Unfortunately, management shakeups and failed product launches, among other things, led to a rocky initial public offering three years ago. Since then, Uber's stock price has mimicked that of a yo-yo, soaring high and crashing low. However, some analyst on Wall Street see a great investing opportunity in Uber and have declared the stock a top pick for 2023. Let's dig into the company's financials and explore why there appears to be a bullish sentiment on the stock.
Last week, Evercore analyst Mark Mahaney discussed Uber during an interview on CNBC. Mahaney included Uber as a top pick for 2023, comparing the company's product to that of a utility more so than a consumer discretionary item. This is an interesting perception of Uber. Essentially, Mahaney argues that even though there are fears of recession and inflation remains a pain point for consumers, Uber's selling point of mobility as a service offers a convenience factor that is unparalleled. The analyst believes that even in the current economy, Uber will still see its share of rides to the airport as well as consumers preferring to call a ride on demand over driving to their destination during leisure activities.
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After a Terrific Quarter, Does Uber Deserve a Spot in Your Portfolio?