Uber Stock Analysis: Is the Uber stock a good investment for your portfolio?
Uber Technologies is looking to acquire its food delivery rival, Grub-hub. This comes after the $2.9B loss for Uber as its ride-hail business dropped 80%. On the bright side, Uber Eats soared 54% as more people looked for food delivery while on Coronavirus lockdown. But around two-thirds of Uber’s quarterly loss was caused by its tanking investments in Asian ride services Didi and Grab. Now Uber wants to expand on what made it the most money, and many investors are excited about it, which showed in Uber’s stock price on Tuesday as the news was announced by Wall Street Journal. Would this acquisition really make Uber stock a buy right now? Could we see a pullback so we can buy at lower prices, or will the price just go up from here? If it could go down, how low will it go? When should you take a profit? What type of investors should even consider adding Uber to their investment portfolio?
I’m going to conduct my Invest Diva diamond analysis or the IDDA for potential investment strategies for the Uber stock.
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Uber Stock Price Analysis – Fundamentals
Uber is not yet on a long-term hold list of Invest Diva’s Premium Investing Group (PIG). But what really sets Uber apart from its competition, Lyft is the fact that they’re expanded over different categories rather than just being a ride-hailing company. Also, Uber likes investors to believe that they’re in fact a data and tech company. Not a ride-hailing company. They have been investing in Artificial Intelligence and self-driving cars for a while. The network effects and valuable intangible assets in the form of user data give Uber a competitive advantage that will help Uber to become profitable and generate excess returns on invested capital
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Uber Stock Technical Analysis – Daily Chart
After its IPO back in 2019, the UBER stock price has been on a roller coaster ride. It took its biggest hit in February 2020 once the COVID-19 pandemic started the lockdown in the US.
However, the stock price was able to recover quite rapidly from there. Its recovery resembles that of the Dow Jones Industrial Average.
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As I explain in detail in this video, based on the GrubHub acquisition rumors we could see further gains towards 35 and maybe even 41 in the medium term.
However, the Uber stock price could then take a hit, bringing it back down to key support levels including 27 and 24.
Uber could be an interesting choice for younger investors with medium to high risk tolerance.
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