Long Trade Idea
Enter your long position between 88.84 (the last intra-day low that dipped into its horizontal support zone) and 92.62 (Friday’s intra-day high).
Market Index Analysis
- Uber Technologies (UBER) is a member of the S&P 500.
- This index tries to hold on to records, but bearish catalysts are accumulating.
- The Bull Bear Power Indicator of the S&P 500 is bearish with a descending trendline.
Market Sentiment Analysis
Equity futures are rising following a volatile week, which saw new worries about the AI bubble, partially fueled by concerns over creative accounting rules for depreciation of massive infrastructure investments and revenue concerns. Despite the end of the government shutdown, economic data may trail for a while. Still, investors await NVIDIA’s earnings on Wednesday, which will move markets. Other notable earnings reports, this week, include Walmart, Home Depot, Target, Lowe’s, and Gap, which will offer insight into consumer spending.
Uber Technologies Fundamental Analysis
Uber Technologies is the world’s largest ridesharing company with over 150 million monthly users and six million drivers. It is a controversial and disruptive company with excellent profit margins, but high debt levels and balance sheet issues.
So, why am I bullish on UBER after its earnings report?
UBER reported a 22% surge in trips, a 21% surge in bookings year over year, and a 17% rise in active monthly consumers to 189 million. Revenues clocked in at $13.47 billion with earnings per share of $3.11, beating analysts’ estimates. It also provided better-than-expected fourth-quarter guidance. I am bullish on its overall momentum and investments into mobility, autonomous delivery, and its Uber Eats business.
Uber Technologies Fundamental Analysis Snapshot
The price-to-earnings (P/E) ratio of 11.79 makes UBER an inexpensive stock. By comparison, the P/E ratio for the S&P 500 is 30.26.
The average analyst price target for UBER is 110.55. It suggests good upside potential with fading downside risks.
Uber Technologies Technical Analysis
Today’s UBER Signal
- The UBER D1 chart shows a price action approaching its horizontal support zone
- It also shows price action between its descending 0.0% and 38.2% Fibonacci Retracement Fan levels
- The Bull Bear Power Indicator is bearish with a positive divergence
- The average bullish trading volumes are higher than the average bearish trading volumes
- UBER corrected with the S&P 500, but bullish catalysts have accumulated
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My Call
I am taking a long position in UBER between 88.84 and 92.62. Operational cash flow and overall cash reserves are excellent, and UBER grew EPS by over 130% year over year. The potential of its autonomous delivery plans remains undervalued, and UBER has excellent momentum.
- UBER Entry Level: Between 88.84 and 92.62
- UBER Take Profit: Between 110.55 and 116.08
- UBER Stop Loss: Between 79.40 and 81.86
- Risk/Reward Ratio: 2.30
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