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Uber Technologies’ (UBER - Free Report) second-quarter results beat Wall Street estimates on the back of steady demand for its ride-sharing and food-delivery services, sending the company's shares up 10.9% on Tuesday. The company came up with quarterly earnings of $0.47 per share, beating the Zacks Consensus Estimate of $0.31 per share. This compares to earnings of $0.18 per share a year ago.
Uber, which belongs to the Zacks Internet - Services industry, posted revenues of $10.7 billion for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 1.34%. This compares to year-ago revenues of $9.23 billion. The company has topped consensus revenue estimates three times over the last four quarters.
With stay-at-home fading away, ride-sharing demand has been improving over the past several months, benefiting companies such as Uber and rival Lyft. Trips by self-driving vehicles on Uber's platform were six times higher in the quarter, helped by partnerships with companies including Alphabet's Waymo for rideshare and food delivery, as well as startup Waabi for freight services.
"We would expect forward gross bookings and EBITDA estimates to rise modestly based on Q2 results and the Q3 guide," Evercore ISI lead analyst Mark Mahaney said, as quoted on Reuters. Uber forecast third-quarter gross bookings — which include its mobility, delivery and freight segments — between $40.25 billion and $41.75 billion, the midpoint of which was below analysts' estimates of $41.26 billion.
However, Uber management acknowledged that some concerns are brewing in the restaurants and food delivery space, but a greater focus on groceries through expanded partnerships with Instacart and Costco Wholesale boosted deliveries. Uber forecast adjusted core earnings between $1.58 billion and $1.68 billion in the third quarter compared with estimates of $1.62 billion.
Price Target
Based on short-term price targets offered by 40 analysts, the average price target for Uber Technologies comes to $87.08. The forecasts range from a low of $62.00 to a high of $145.00. The average price target represents an increase of 48.91% from the last closing price of $58.48 as of Aug 5, 2024.
ETFs in Focus
Against this backdrop, below we highlight a few ETFs that are heavy on Uber and can be played. Uber has a Zacks Rank #3 (Hold). The fund has considerable exposure to iShares US Transportation ETF (IYT - Free Report) . The Uber stock has 18.62% weight in the fund.
Franklin Disruptive Commerce ETF’s (BUYZ) second-largest holding is Uber. The stock has a 7.13% weight in the fund. The Franklin Disruptive Commerce ETF seeks capital appreciation by investing in innovative companies benefiting from transformation in the e-commerce space.
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ETFs to Buy as Uber Rallies Post Earnings Release
Uber Technologies’ (UBER - Free Report) second-quarter results beat Wall Street estimates on the back of steady demand for its ride-sharing and food-delivery services, sending the company's shares up 10.9% on Tuesday. The company came up with quarterly earnings of $0.47 per share, beating the Zacks Consensus Estimate of $0.31 per share. This compares to earnings of $0.18 per share a year ago.
Uber, which belongs to the Zacks Internet - Services industry, posted revenues of $10.7 billion for the quarter ended June 2024, surpassing the Zacks Consensus Estimate by 1.34%. This compares to year-ago revenues of $9.23 billion. The company has topped consensus revenue estimates three times over the last four quarters.
With stay-at-home fading away, ride-sharing demand has been improving over the past several months, benefiting companies such as Uber and rival Lyft. Trips by self-driving vehicles on Uber's platform were six times higher in the quarter, helped by partnerships with companies including Alphabet's Waymo for rideshare and food delivery, as well as startup Waabi for freight services.
"We would expect forward gross bookings and EBITDA estimates to rise modestly based on Q2 results and the Q3 guide," Evercore ISI lead analyst Mark Mahaney said, as quoted on Reuters. Uber forecast third-quarter gross bookings — which include its mobility, delivery and freight segments — between $40.25 billion and $41.75 billion, the midpoint of which was below analysts' estimates of $41.26 billion.
However, Uber management acknowledged that some concerns are brewing in the restaurants and food delivery space, but a greater focus on groceries through expanded partnerships with Instacart and Costco Wholesale boosted deliveries. Uber forecast adjusted core earnings between $1.58 billion and $1.68 billion in the third quarter compared with estimates of $1.62 billion.
Price Target
Based on short-term price targets offered by 40 analysts, the average price target for Uber Technologies comes to $87.08. The forecasts range from a low of $62.00 to a high of $145.00. The average price target represents an increase of 48.91% from the last closing price of $58.48 as of Aug 5, 2024.
ETFs in Focus
Against this backdrop, below we highlight a few ETFs that are heavy on Uber and can be played. Uber has a Zacks Rank #3 (Hold). The fund has considerable exposure to iShares US Transportation ETF (IYT - Free Report) . The Uber stock has 18.62% weight in the fund.
Franklin Disruptive Commerce ETF’s (BUYZ) second-largest holding is Uber. The stock has a 7.13% weight in the fund. The Franklin Disruptive Commerce ETF seeks capital appreciation by investing in innovative companies benefiting from transformation in the e-commerce space.