Melius analysts initiated coverage on Uber (NYSE:UBER) with a Hold rating and set a price target of $77 on the stock. The analysts noted that Uber is a trailblazer in the rideshare sector, offering a wide array of services across mobility, delivery, and freight. The company has been expanding its mobility products to better meet demand while continuing to scale its operations both domestically and internationally.
A significant focus for Uber has been cross-selling between its mobility and delivery segments, with one-third of monthly consumers using multiple products. This strategy increases penetration rates in mature markets and reduces customer acquisition costs by 50% in paid channels. Uber's business is expected to continue growing at a robust pace, with gross bookings projected to have a compound annual growth rate (CAGR) in the mid to high teens over the next three years, aligning with Street expectations of 16%. Additionally, EBITDA is anticipated to grow annually at a high rate of 30% to 40%, compared to the Street’s estimate of 39%.