Mobility services provider Uber Technologies, Inc. (NYSE: UBER) recently revealed that it has launched autonomous deliveries for the customers of Uber Eats in Santa Monica, CA, in collaboration with an autonomous vehicle company, Motional.
Following the news, shares of the company declined 3.3% on Monday. The fall, however, can be attributed to wider market concerns, as the stock recovered marginally to close at $23.72 in the extended trading session.
The launch follows the announcement of the companies’ partnership in December, which was aimed at bringing autonomous vehicles into the delivery space to provide cost-efficient and reliable deliveries.
Further, depending upon the success of this pilot project, Uber and Motional will look into expanding this service.
The deliveries will be carried out through Motional’s IONIQ 5 vehicles. Customers will receive an alert on their Uber Eats App to securely unlock the vehicle and receive their deliveries.
The Global GM for Uber’s Autonomous Mobility and Delivery Business, Noah Zych, said, “At Uber, we’re always looking for ways to use new technology to help consumers go anywhere and get anything. We’re thrilled to begin piloting with Motional in California and are eager to see how their promising autonomous technology will begin to change how people and goods move throughout the world for the better.”
Recently, Susquehanna analyst Shyam Patil reiterated a Hold rating on the stock. The analyst, however, lowered the price target from $43 to $29, which implies upside potential of 22.9% from current levels.
Consensus among analysts is a Strong Buy based on 24 Buys and two Holds. UBER’s average price target of $51.62 implies upside potential of 118.8% from current levels. Shares have declined 50.4% over the past year.
TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Uber’s performance this quarter.
According to the tool, the Uber website recorded a 91.65% monthly rise in global visits in April, compared to the same period last year. Moreover, the footfall on the company’s website has grown 120.85% year-to-date, compared to the previous year.
Uber’s move of autonomous deliveries can be a game-changer for the company, as it can result in reduced costs and more efficient operations, which, in turn, is expected to aid its profitability in the future.
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