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The Zacks Consensus Estimate for the to-be-reported quarter’s earnings and revenues is pegged at 31 cents per share and $10.6 billion, respectively.
The earnings estimate for the to-be-reported quarter has remained stable over the past 60 days. The bottom-line projection indicates year-over-year growth of 72.2%. The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year increase of 14.4%.
Image Source: Zacks Investment Research
UBER has a decent earnings surprise history, as reflected in the chart below.
Image Source: Zacks Investment Research
Earnings Whispers for Q2
Our proven model does not conclusively predict an earnings beat for UBER this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
With economic activities returning to normal levels in the post-pandemic scenario, people are traveling to work and other places as before. UBER’s Mobility business has been seeing buoyant demand. With customer traffic picking up, gross bookings from the unit are likely to have been impressive. We expect gross bookings from the Mobility segment in the June quarter to grow 21.5% on a year-over-year basis.
Uber’s Delivery business is also expected to have performed well in the to-be-reported quarter. We expect gross bookings from the Delivery segment in the June quarter to grow 8.3% on a year-over-year basis.
Total trips are expected to soar 22.9% year over year in the second quarter, per our model. Freight revenues are likely to have suffered in the to-be-reported quarter due to a challenging freight market.
Price Performance & Valuation
On a year-to-date basis, shares of UBER have gained 5.2%, underperforming the industry. UBER shares have outperformed rival Lyft (LYFT - Free Report) while underperforming fellow industry player DoorDash (DASH - Free Report) in the same timeframe.
YTD Price Comparison
Image Source: Zacks Investment Research
From a valuation perspective, UBER is trading at a discount compared to the industry going by its price/sales ratio. The company is trading at a forward sales multiple of 2.77 compared to its industry’s 5.54. The reading is also below its median of 3.01 over the last five years.
Image Source: Zacks Investment Research
Investor Considerations
Diversification is imperative for big companies to reduce risks, and UBER has excelled in this area. It has engaged in numerous strategic acquisitions, geographic and product diversifications and innovations. Uber’s endeavors to expand into international markets are commendable and provide it with the benefits of geographical diversification. Prudent investments enable it to extend its services and solidify its comprehensive offerings.
Even though Uber’s primary business is ride-sharing, it has diversified into food delivery and freight over time. Both its ride-sharing and delivery platforms are growing in popularity. This is generating strong demand, which, along with new growth initiatives and continued cost discipline, are driving the company’s results. However, the performance of the Freight unit due to the slowdown in freight demand is concerning. Additionally, Uber has been grappling with labor unrest for some time. We are also concerned about its high debt levels.
Long-Term Debt to Capitalization
Image Source: Zacks Investment Research
Final Thoughts
Given the abovementioned headwinds, we believe that investors should refrain from rushing to buy UBER before Tuesday despite it being attractively valued and having a lot in its favor. Instead, they should monitor the developments pertaining to the stock closely for a more appropriate entry point, as an erroneous and hasty decision could affect portfolio gains. If an investor already holds UBER stock in their portfolio, sit tight, as the upcoming earnings report is likely to confirm the expectations about the company's strong performance.
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Should You Buy, Sell or Hold UBER Stock Before Q2 Earnings?
Uber Technologies (UBER - Free Report) , a leading ride-hailing company, is set to report second-quarter 2024 results on Aug 6, before market open.
The Zacks Consensus Estimate for the to-be-reported quarter’s earnings and revenues is pegged at 31 cents per share and $10.6 billion, respectively.
The earnings estimate for the to-be-reported quarter has remained stable over the past 60 days. The bottom-line projection indicates year-over-year growth of 72.2%. The Zacks Consensus Estimate for quarterly revenues suggests a year-over-year increase of 14.4%.
UBER has a decent earnings surprise history, as reflected in the chart below.
Earnings Whispers for Q2
Our proven model does not conclusively predict an earnings beat for UBER this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
UBER has an Earnings ESP of 0.00% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Factors Likely to Shape UBER’s Q2 Results
With economic activities returning to normal levels in the post-pandemic scenario, people are traveling to work and other places as before. UBER’s Mobility business has been seeing buoyant demand. With customer traffic picking up, gross bookings from the unit are likely to have been impressive. We expect gross bookings from the Mobility segment in the June quarter to grow 21.5% on a year-over-year basis.
Uber’s Delivery business is also expected to have performed well in the to-be-reported quarter. We expect gross bookings from the Delivery segment in the June quarter to grow 8.3% on a year-over-year basis.
Total trips are expected to soar 22.9% year over year in the second quarter, per our model. Freight revenues are likely to have suffered in the to-be-reported quarter due to a challenging freight market.
Price Performance & Valuation
On a year-to-date basis, shares of UBER have gained 5.2%, underperforming the industry. UBER shares have outperformed rival Lyft (LYFT - Free Report) while underperforming fellow industry player DoorDash (DASH - Free Report) in the same timeframe.
YTD Price Comparison
From a valuation perspective, UBER is trading at a discount compared to the industry going by its price/sales ratio. The company is trading at a forward sales multiple of 2.77 compared to its industry’s 5.54. The reading is also below its median of 3.01 over the last five years.
Investor Considerations
Diversification is imperative for big companies to reduce risks, and UBER has excelled in this area. It has engaged in numerous strategic acquisitions, geographic and product diversifications and innovations. Uber’s endeavors to expand into international markets are commendable and provide it with the benefits of geographical diversification. Prudent investments enable it to extend its services and solidify its comprehensive offerings.
Even though Uber’s primary business is ride-sharing, it has diversified into food delivery and freight over time. Both its ride-sharing and delivery platforms are growing in popularity. This is generating strong demand, which, along with new growth initiatives and continued cost discipline, are driving the company’s results. However, the performance of the Freight unit due to the slowdown in freight demand is concerning. Additionally, Uber has been grappling with labor unrest for some time. We are also concerned about its high debt levels.
Long-Term Debt to Capitalization
Final Thoughts
Given the abovementioned headwinds, we believe that investors should refrain from rushing to buy UBER before Tuesday despite it being attractively valued and having a lot in its favor. Instead, they should monitor the developments pertaining to the stock closely for a more appropriate entry point, as an erroneous and hasty decision could affect portfolio gains. If an investor already holds UBER stock in their portfolio, sit tight, as the upcoming earnings report is likely to confirm the expectations about the company's strong performance.