Uber UBER
What does Uber do?
Uber operates a platform that digitally matches demand and supply for passenger transport, food delivery and freight. Consumers use the app to book rides, order meals or groceries and access other services. On the supply side are independent drivers, couriers, restaurants, merchants and freight carriers.
The business is divided into the Mobility, Delivery and Freight segments. Revenue comes mainly from intermediation fees and shares of the transactions processed through the platform, supplemented by advertising offerings and partnerships. In competition, Uber benefits from its international presence, a large user base and the bundling of several services in one app. Competitors include regional ride-hailing services, other delivery platforms, traditional taxi providers and operators of autonomous vehicle fleets, who may act as either competitors or partners.
Score profile
Rank vs. Software - Application (71 companies). 10 = top of the group, 5 = middle. Calculated from the metrics below, without AI.
Metrics compared with the industry
On profitability and quality, Uber ranks below average in the group Software - Application (3.0/10). On growth, the company ranks below average in the group Software - Application (2.3/10). On valuation (higher = cheaper), the stock ranks in the middle in the group Software - Application (4.5/10). On financial strength, Uber ranks in the middle in the group Software - Application (4.4/10).
| Metric | Stock | Group median | Ranking |
|---|---|---|---|
| Forward P/E | 16.0x | 18.0x | better than 52 % |
| Trailing P/E | 41.2x | 32.7x | better than 39 % |
| PEG ratio | 6.0x | 1.4x | better than 6 % |
| EV/EBITDA | 19.7x | 19.7x | better than 50 % |
| Price/sales | 2.5x | 4.4x | better than 72 % |
| Price/book | 5.2x | 5.5x | better than 52 % |
| Revenue growth | 9.6% | 10.8% | better than 43 % |
| Earnings growth | -92.0% | 9.4% | better than 2 % |
| Gross margin | 41.4% | 71.8% | better than 8 % |
| Operating margin | 9.8% | 15.7% | better than 32 % |
| Net margin | 6.1% | 12.3% | better than 35 % |
| Return on equity | 12.3% | 13.2% | better than 47 % |
| Debt/equity | 61.2% | 46.9% | better than 35 % |
| Current ratio | 1.2x | 1.2x | better than 50 % |
| Free cash flow yield | 5.2% | 5.3% | better than 48 % |
| Dividend yield | 0.0% | 1.1% | – |
| Payout ratio | 0.0% | 31.2% | – |
| Beta | 1.31 | 0.96 | – |
Valuation: what is Uber worth?
Two valuation approaches – a discounted cash flow model and a valuation at the industry’s median multiples – give Uber a model range of 51.01 USD to 79.06 USD per share.
47 analysts, average rating “Buy”, average price target 99.17 USD (+41.6%).
The full DCF matrix, the reverse DCF (what growth the price implies) and scenarios are part of the Pro analysis.
What the business depends on
- The number of active users and how often they use the service determine the transaction volume facilitated through the platform.
- Network effects from a large supply of drivers and merchants improve availability and wait times and help retain customers.
- Bundling mobility, delivery and advertising in one app increases revenue per user and improves scalability.
Risks
- Regulation on classifying drivers as self-employed or employees may raise costs and change the business model.
- Autonomous vehicles could shift the platform's role if technology providers reach customers directly.
- Intense competition and price pressure in ride-hailing and delivery require high spending on incentives and marketing.
What to look for with Uber
Gross bookings relative to adjusted EBITDA show how well the platform converts facilitated volume into earnings while scaling.