By Sam Boughedda
Investing.com — Uber Technologies Inc (NYSE:UBER) shares rose at the start of Friday's session after Needham analyst Bernie McTernan called the company a top pick for 2022.
McTernan added Uber to Needham's conviction list and lowered the price target on the shares to $75 from $77, keeping a buy rating.
“Calling the floor in UBER has been difficult given a reliance on EV/Sales multiples. UBER looked cheap to us from 6x sales all the on its way to 3.5x currently," said the analyst in a research note.
McTernan explained that he believes this year will be different due to the outlook for adjusted earnings before interest, taxes, depreciation and amortization, which they forecast "improving from -$800M in '21E to $1.3B in '22E to $3.3B in '23E."
"UBER is on the brink of investors being able to put a multiple on a fairly close annual metric, which should provide a studier floor for valuation,” McTernan said in a client note," he added.
Elsewhere, in a further boost for Uber, Jefferies analyst Brent Thill downgraded LYFT Inc (NASDAQ:LYFT) to hold from buy, telling investors in a research note that Lyft will fall behind Uber due to "the re-opening focus widening beyond the U.S. to global markets where UBER stands to benefit."