Give ride-hailing kingpin Uber (NASDAQ:UBER) its due. Even as the market sours, people travel less and stay at home more, Uber is still putting its focus clearly on profitability. Although, admittedly, that’s likely to be tougher than it’s been in a while. Still, investors are confident, and Uber stock was up 2.7% at one point in the final minutes of Thursday’s trading session.
CEO Dara Khosrowshahi took to the stage at the Skift Global Forum to spell out just what Uber’s plans were for staying on top of the ride-hailing and delivery heap. Keeping costs low was one key point, as were plans to step into some new markets by adding things like travel services. Vigilance is giving Uber an edge in the market, as it recently reported its first quarterly profit, along with free cash flow of over $1.2 billion.
But it’s also clear that Uber will have its work cut out for it. Yes, it’s offering more services, but it’s offering these services into a period of increasing softness in the consumer market. The consumer, a growing number of sources report, is tapped out. Throw in rising labor costs as Uber—along with a number of its contemporaries—lost a bid to block a new minimum wage bill in New York City that will see Uber drivers paid $18 an hour minimum. That makes things even worse. Uber will have to pay more for labor in an environment where it’s harder to recoup those costs.
Is Uber Stock a Good Buy Right Now?
However, analysts are confident that Uber will find a way to make it all work. Uber stock is currently rated a Strong Buy, supported by 31 Buy ratings and one Hold. Further, with an average price target of $59.47, Uber stock offers its investors 28.38% upside potential.
