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UBER Raises Prices in California to Pay for Worker Benefits
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Uber Technologies (UBER - Free Report) has raised prices for customers in California, effective Monday, in order to cover the cost of additional benefits that its workers are liable to receive as part of Proposition 22 (Prop 22), which was passed by California voters in November.
Uber, its rival Lyft (LYFT - Free Report) and other gig economy companies invested as much as $200m in Prop 22, a ballot initiative, to be exempted from California’s labor law, which would have forced it to classify its workers as employees. While Prop 22 allows Uber to maintain the independent contractor status for its drivers and delivery people in California, it requires the company to provide workers with a number of benefits, such as a certain amount of guaranteed earnings, a healthcare stipend and accident insurance for on-the-job injuries.
To pay for these perks, Uber, carrying a Zacks Rank #3 (Hold), is levying additional charges of up to $1.5 on each ride and up to $2 on deliveries. Lyft, carrying a Zacks Rank #5 (Strong Sell), is yet to raise prices for its rides.
Amid the coronavirus pandemic, Uber’s rides business is witnessing a significant downturn, thanks to low ride volumes. However, its delivery business is experiencing a boom with online order volumes from homebound customers increasing.
To focus on its core ride-hailing and delivery platforms, the company is exiting side businesses. Earlier in the month, there was news that it will sell its flying taxi unit, Uber Elevate, to Joby Aviation, a California-based startup developing electric aircraft. Prior to that, it entered into a definitive agreement with Aurora Innovation to sell its self-driving unit Advanced Technologies Group or ATG.
Shares of Baidu and The Trade Desk have rallied more than 52% and 100% in the past six months, respectively.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
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UBER Raises Prices in California to Pay for Worker Benefits
Uber Technologies (UBER - Free Report) has raised prices for customers in California, effective Monday, in order to cover the cost of additional benefits that its workers are liable to receive as part of Proposition 22 (Prop 22), which was passed by California voters in November.
Uber, its rival Lyft (LYFT - Free Report) and other gig economy companies invested as much as $200m in Prop 22, a ballot initiative, to be exempted from California’s labor law, which would have forced it to classify its workers as employees. While Prop 22 allows Uber to maintain the independent contractor status for its drivers and delivery people in California, it requires the company to provide workers with a number of benefits, such as a certain amount of guaranteed earnings, a healthcare stipend and accident insurance for on-the-job injuries.
To pay for these perks, Uber, carrying a Zacks Rank #3 (Hold), is levying additional charges of up to $1.5 on each ride and up to $2 on deliveries. Lyft, carrying a Zacks Rank #5 (Strong Sell), is yet to raise prices for its rides.
Uber Technologies, Inc. Price
Uber Technologies, Inc. price | Uber Technologies, Inc. Quote
Amid the coronavirus pandemic, Uber’s rides business is witnessing a significant downturn, thanks to low ride volumes. However, its delivery business is experiencing a boom with online order volumes from homebound customers increasing.
To focus on its core ride-hailing and delivery platforms, the company is exiting side businesses. Earlier in the month, there was news that it will sell its flying taxi unit, Uber Elevate, to Joby Aviation, a California-based startup developing electric aircraft. Prior to that, it entered into a definitive agreement with Aurora Innovation to sell its self-driving unit Advanced Technologies Group or ATG.
Key Picks
Some better-ranked stocks in the Zacks Internet - Services industry are Baidu (BIDU - Free Report) and The Trade Desk (TTD - Free Report) , both sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Shares of Baidu and The Trade Desk have rallied more than 52% and 100% in the past six months, respectively.
Zacks Names “Single Best Pick to Double”
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>