Uber (NYSE:UBER) was cut to Outperform from Buy at Daiwa on Wednesday, with analysts raising the price target to $51 from $42 per share.
They told investors in a note that while the firm is still constructive on the stock, rising expectations and its increasing share price have driven the downgrade.
"We believe Uber's global scale and cross-platform synergies make it best-positioned to capitalize on increasing penetration while navigating potential downturns and regulatory cost pressures," said analysts.
"Uber seems on track to hit its $5bn adj. EBITDA target for 2024, given close to $1bn quarterly run rate we estimate for 2H:23. However, the company's gross bookings (GB) target of $165bn - $175bn requires some acceleration in growth rates. Adverse currency, freight slowdown and slower than anticipated growth in Delivery are primary attributes to the shortfall versus target."
Despite the downgrade, analysts also noted Uber's "execution and strong operating leverage demonstrate the power of its earnings model."