Wedbush Adjusts Coverage
Wedbush(RANK#32) analysts have increased their target price for Uber Technologies Inc (NYSE: UBER) from $38 to $40, giving the ride-share giant a “repeat Outperform” rating. This comes after the company reported strong fourth quarter 2022 earnings and delivered “Zach Ertz-like results,” according to the analysts, referring to American football tight end, Zach Ertz.
The adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for the quarter came in at $665 million, with a 7.7% margin, beating the Street’s expectations of $624 million and 7.3% margin. The strong results in the Mobility and Delivery segments showed that Uber is capable of balancing its aggressive growth strategy with profitability. The company also reported gross bookings of $30.75 billion, slightly above the Street’s expectation, and total revenue of $8.61 billion that beat the Street’s estimate of $8.51 billion.
Wedbush analysts also highlighted Uber’s guidance for 2023, which showed a strong outlook for the company. The adjusted EBITDA guidance of between $666 million and $700 million is well above the Street’s estimate of $612.1 million, and the Gross Bookings are forecast to be between $31 billion and $32 billion, in line with the Street’s estimate of $31.25 billion. This points to the strength of Uber’s business model post-pandemic, with the company confident in sustaining its Gross Bookings growth while benefiting from post-pandemic trends globally.
The analysts believe that this was a major step in the right direction for Uber, with a profitable growth story into 2023 and beyond. The company’s strong fourth quarter results and positive guidance have instilled confidence in the analysts and they expect to see continued growth in the future. Despite shares being flat in pre-market trading at around $36.82, the analysts believe that the target price increase is justified, given the company’s strong performance.
