Uber Technologies Inc (NYSE: UBER) has been a nightmare for shareholders this year, with the stock down about 30% YTD; but the worst is now in the rearview mirror, says Deutsche Bank.
Benjamin Black starts Uber stock with a ‘buy’ rating
Analyst Benjamin Black assumed coverage of the stock on Friday with a “buy” rating” and a price target of $50 a share that represents a 65% upside from here. In a note to clients, he wrote:
Uber’s current businesses address a roughly $7 trillion market (of which a subset is serviceable), and our bullish view on the stock is grounded in its powerful platform synergies, which should drive faster and more efficient penetration of the total addressable market versus its competitors.
Earlier this week, Uber bumped up its EBITDA guidance for the current quarter to $130 million to $150 million.
Analyst dubs Uber the leader of the ride-sharing market
According to the Deutsche Bank analyst, Uber offers multiple services that makes it a better pick than its pure-play rivals, as it can bring more customers and suppliers than the likes of Lyft. Black added:
We think Uber’s platform can drive higher customer and supplier captivity than any of the pure-play mono-product alternative services. As such, we think density will be much higher across both sides of the marketplace, which not only lowers costs, but also improves the respective products.
He dubbed Uber the leader of the ride-sharing market and said the current discounted valuation makes up for an attractive entry point.
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