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Uber Stock Is Near New Highs, Here Are 3 Reasons Why

Published 15/12/2023, 16:55
© Reuters. Uber Stock Is Near New Highs, Here Are 3 Reasons Why
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Benzinga - by Surbhi Jain, .

Uber Technologies Inc (NYSE:UBER) had a good ride so far in 2023.

The company’s stock has surged 127.52% compared to the broad market S&P 500 Index which is up 18.13% YTD. It recorded a new 52-week high on Dec. 12 trading, when it touched $63.03 a share.

3 Reasons That Drove UBER Stock

  • The S&P 500 Index inclusion: Uber shares have been surging following news of its inclusion in the S&P 500 index on December 18. The stock may have further upside on the S&P 500 inclusion news, as it will likely attract more buying from funds passively tracking the index, and a general shift in perception.
  • Recent Partnerships: Recent partnerships with Tesla Inc (NASDAQ:TSLA), Domino’s Pizza Inc (NYSE:DPZ), and Sprouts Farmers Market Inc (NASDAQ:SFM). Read more about these here:

    Tesla Teams Up With Uber, Offer Drivers Up To $3K in Savings On Electric Cars

    Domino’s Pizza Bull Analyst Sees Multiple Catalysts Driving Stock Above $450 In 2024

    Healthy Groceries On The Go: Sprouts Farmers Market Now Offering Delivery Via Uber Eats

  • Fundamental business strength: Uber reported robust Q3 profits, with adjusted EBITDA rising 112% YoY and revenues up 11% YoY. Given its robust customer demand and estimated $5.7 trillion market capitalization, the company has substantial expansion potential.

    • What Does The Chart Say?

    A quick look at the chart above shows UBER stock driving northwards. However, one must not fail to notice the RSI levels as well. Uber’s stock has been ‘overbought’ since early November. This implies that it may be primed for a trend reversal or corrective price pullback.

    Recent news has driven the stock to levels so high, that fundamental valuation of the stock may have to catch up to it. At a forward P/E of 166.15, the stock’s valuation is way above the sector’s median forward P/E of 21.95.

    Read Next: Uber Launches Rudolph-Like Robot Reindeers For Food Deliveries, Store Pickups For Gifts This Christmas

    Image: Shutterstock

    © 2023 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

    Read the original article on Benzinga

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