Why is Uber so Cheap?

Just as free cash is about to flow.

Andrew Willis 27 May, 2022 | 4:48AM
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Andrew Willis: Since featuring how cheap Uber was last year, Uber (UBER)’s only gotten cheaper. Meanwhile, the network effect remains intact, with more drivers than at any point since the pandemic and users and trips up 17% and 18% year over year, respectively. What gives?

Like many investors, Uber got burned by a SPAC – with a stake in Grab (GRAB) that’s fallen over 80% since its high in November. Its stake in another Asian ride-hailing business, Didi (DIDI), also did terribly. And its investment in autonomous vehicle company Aurora (AUR) did not fare well.

Uber’s been a victim of the tech rout on a few levels lately, but senior equity analyst Ali Mogharabi says the core business is delivering solid results, with free cash flow expected this year. Would the sell-off continue then?

For Morningstar, I’m Andrew Willis.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Uber Technologies Inc68.98 USD-0.32Rating

About Author

Andrew Willis

Andrew Willis  is Senior Editor at Morningstar.ca. He previously produced content for Fidelity Investments and finance events for Euromoney Institutional Investor and has written in the past for Thomson Reuters and CNN. Follow him on Twitter @AndrewWillisCDN.

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