Uber Inc. (UBER) PT Raised to $47 at Mizuho on Positive Food Delivery Trends

Mizuho Securities analyst James Lee raised the price target on Uber Inc. (NYSE: UBER) to $47.00 (from $42.00) while maintaining a Buy rating on Positive food delivery trends.

The analyst commented, "Our checks on Uber shows that fundamentals are trending in the right direction. For Rides, we are seeing a gradual improvement for GB from -72% YoY growth in 2Q20 to -53% in July and -50% in August. With rising COVID cases in Europe and the slower opening up in the US in the month of September, we believe that the business are tracking modestly behind consensus of -48% YoY growth. For Eats, we believe that demand for delivery remained strong, and GB continues to grow at an accelerated pace from 90% YoY in March to 126% in June and to over 130% in August, tracking ahead of consensus at 110% YoY growth for 3Q20. With the pending acquisition of Postmates, we believe that Uber is looking to become a super-regional player in the US similar to Alibaba’s ele.me in China, focusing on increasing dominance in 6 of the top 14 cities where the combined company has >35% market share. With a stronger outlook for food delivery, we are raising our FY23 Eats revenues by 11% to $56bn and raising our FY23 EBITDA estimate by nearly 10% to $4.8bn. Maintain Buy rating and raise PT from $42 to $47, based on SOTP analysis; implies 17x FY23 EBITDA. We foresee upcoming catalysts including: (1) the positive voting results of Proposition 22 and; (2) Equity investments in ATG to reduce EBITDA losses."

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