Monday, July 22, 2019

"Uber Profit Path Seen Slowed by Riders Taking Cheaper Rides" (UBER)

From Bloomberg:
Uber Technologies Inc.’s path to profit is likely to be slowed by growing competition as a significant number of customers are willing to wait around for a cheaper ride, according to analysts at HSBC.

The company, which went public in May, will need to fend off “tough and persistent” rivals that cater to price-conscious consumers, Masha Kahn and Henning Cosman wrote as they initiated coverage of the stock with a hold rating. Lyft Inc. often prices 20-25% below Uber in New York and Daimler AG-backed Bolt is now doing the same in London, they said.

Uber shares have recovered much of the 18% decline seen in the first few days that followed the company’s Wall Street listing, but have still trailed the broader U.S. tech sector. HSBC gave the stock its 11th hold rating, while it has 23 buys and zero sells among analysts surveyed by Bloomberg....MORE
It's not as though Uber can continue with business as usual. As of the last 10Q they were down to $3.2 billion of net current assets. And for their sake let's hope the cash burn rate declines in a big way.
All this and more in the upcoming report.