Uber deal with Waymo ‘addresses single biggest overhang,’ says Evercore ISI

Following the news that Uber (UBER) has extended its partnership with Alphabet’s (GOOGL) Waymo to Austin and Atlanta, Evercore ISI analyst Mark Mahaney is reiterating an Outperform rating and $90 price target on Uber shares, calling the announcement a “key catalyst” that “directly addresses the single biggest overhang” on Uber shares. There have been two overhangs on shares this year: exposure to arguably softening consumer discretionary spending; and the concern that the rise of robo-taxis like Waymo and the potential Tesla (TSLA) launch could obviate the need for ridesharing services, at least those structured like Uber, the analyst argues. Uber’s results year-to-date, along with those of Lyft (LYFT) and DoorDash (DASH), have “clearly addressed the first overhang,” Evercore says. The analyst adds that the firm has long viewed the robo-taxi overhang as “simply requiring” a business development solution, like the distribution deal announced this morning.