Uber Technologies is the IBD Stock of the Day, as Uber stock consolidates around a potential flat base chart pattern. Shares of the ride-hailing player have gained nearly 30% so far this year, helped by strong earnings and plans for the company's first-ever stock buyback.
On the stock market today, Uber stock slipped a fraction to close at 80.23.. Shares of the San Francisco-based company gapped up about 15% on Feb. 14, after Uber announced plans for its first-ever buyback. Since then, Uber stock has consolidated near a 52-week high of 82.14. Over the past 12 months, Uber shares have surged more than 150%.
Uber swung to a profit last year, with earnings of 87 cents per share for its fiscal year ending with December 2023. Analysts project the ride-hailing and food-delivery firm will grow earnings 43% this year, to $1.24 per share, according to FactSet.
Uber Stock Jumps After Buyback
Uber Chief Executive Dara Khosrowshahi hinted that Uber was planning a buyback last fall. The company made it official ahead of its Feb. 14 virtual investor day. Uber said its board has approved the repurchase of up to $7 billion in stock.
During its virtual investor event that same day, Uber offered new projections for the next three years. Over that period, Uber projects annual gross bookings growth in the mid- to high-teens. Gross bookings are the total dollar value of fares charged for transportation, food delivery and other services.
Further, the company said it expects adjusted EBITDA — earnings before interest, taxes, depreciation, and amortization — to grow in the "high 30s to 40%" annually over the next three years, as the company described in a regulatory filing.
Following the report, JPMorgan maintained a positive overweight rating for Uber stock and upped its target price to 95 from 84.
"We continue to believe that Uber's scale and platform advantages will help drive large, sustainable growth opportunities across Mobility and Delivery, while generating strong EBITDA and free cash flow," JPMorgan analyst Doug Anmuth said in a Feb. 14 client note.
Wall Street Analysts Remain Bullish On Uber
Wall Street analysts are bullish overall on Uber. Of the 51 analysts with coverage of the stock, 46 have a buy or buy-equivalent rating, according to FactSet.
On Feb. 7, Uber reported fourth quarter earnings of 66 cents per share, up 127% from the same period a year earlier. Revenue climbed 15% to $9.9 billion.
Further, Uber was recently added to the Dow Jones Transportation Average, replacing JetBlue Airways.
But Uber does still regularly face regulatory challenges. Most recently, Uber and Lyft threatened to leave Minneapolis over a driver minimum wage law. Minnesota Public Radio reported Thursday that city lawmakers "may be open to changes" to the ride-share driver pay ordinance.
Uber Stock: Technical Ratings
Shares of Uber have traded tightly in recent weeks between a low near 74 and a high of 82.14, which could provide an early entry point for an emerging flat base pattern. Uber has also bounced up from its 10-week trading average, MarketSurge data shows.
Uber stock holds a best-possible IBD Composite Rating of 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one. The best growth stocks typically have a Composite Rating of 90 or better.
Uber stock's Relative Strength Rating score is at 96 out of a best-possible 99, indicating it is significantly outperforming the broader market over the past 52 weeks.
Further, Uber stock holds an Accumulation/Distribution Rating of A-. That rating analyzes price and volume changes in institutional ownership for a stock over the past 13 weeks. The current rating indicates more buying than selling by institutions.
Uber is on the IBD Leaderboard premium stock list, as well as the IBD Big Cap 20 stock list.
