Shares of Uber Technologies Inc. rose. Up 150% last year, after that kind of rise, admittedly, its stock chart might look “scary,” according to a Bernstein analyst.
But how you look at the stock's position now depends on how far you want to look, Bernstein's Nikhil Devnani wrote in a note Monday to clients. uber uber,
He will report earnings on Wednesday and host an investor event next week, and the build-up to these events is not very convincing, in his view, with “expectations continuing to rise.”
“Is there a great history of busy stocks with positive momentum going into investor days?” Devnani asked. “Events like this always make us a bit nervous due to the focus on directions/goals.” He noted that Uber's new CFO may want to set conservative but beatable targets, while Wall Street may be looking for more in light of the stock's significant rise.
However, if we look further, the case for Uber shares becomes more attractive, in his view, as “the fundamentals look strong, and the business…
It's now starting to print money (and a lot of it), management has found a rhythm to outperform and rise, and Uber's market-leading position appears more firmly established than ever.
The company has “lots of buyback potential,” he wrote, and investors will get a better idea of the company's ambitions there when it reports results.
For now, perhaps a lesson from Meta Platforms Inc. META,
Amazon.com AMZN,
And so on. “Watching the big numbers crunch again is also a good reminder that it can pay to own category winners online – and let them accumulate,” Devnani added.
He rates the stock an Outperform, though his $70 target is roughly in line with the current price.
