Uber's (UBER) quarter got some critical reviews from Wall Street Friday following poor second- quarter results that led to the stock plummeting 7.11% to $39.91 a share in morning trading.
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Uber's loss per share came in at $4.72, wider than the expected loss of $2.03 a share. Revenue was $3.17 billion, missing estimates of $3.313 billion. Significantly, revenue only grew 14% year-over-year, the company's slowest quarterly growth number on record. Gross bookings missed expectations, but stripping out currency headwinds brought the gross bookings year-over-year increase to 37%, better than Wall Street expectations of roughly 35%.
Here's what analysts said:
Wedbush Securities, Outperform, Price Target Lowered to $58 From $65
"In a nutshell, there were many puts and takes in the quarter but overall we would characterize this print/guidance as a B performance with the Street expecting an A+ coming off its recent IPO. It all comes down to monetization of the global platform and consistent execution for Dara & Co. going forward, which we believe will ultimately move shares higher over the coming 12 to 18 months. That said, this stock remains a glass half empty name due to its lack of profitability and much skepticism about the ride sharing space with last night's quarter/guidance more of a 'treadmill quarter' rather than one that helps gain much needed Street credibility."
- Dan Ives
Stifel, Hold, Price Target $50
"We are lowering our gross bookings assumptions by ~1% in both 2019 / 2020 vs. guidance of $64B to $66B reported bookings for 2019...We will look for product / market unlocks that could lead to meaningful user/trip growth re-acceleration and/or better-than-expected take rate trends. Further consolidation and private capital flows in Uber's international markets in the food delivery business will likely keep the competitive environment dynamic, in our view. The competitive environment in U.S. ride sharing is helping both Uber and Lyft (LYFT) and will likely serve as a ride sharing take rate tailwind through 2H."
- Scott Devitt
RBC Capital Markets, Outperform, Price Target $63 (Unchanged)
"Lowering '19 Rev. est. 1%, while '19 EBITDA losses improve 18%. PT stays at $62, based on 5.0X EV/Sales on our '20 Rev. est. of $19B. A 30% 3-year Rev. CAGR, DCF, and Comps support PT...Q2 Adjusted Net Revenue of $2.9B came in below RBC/Street at $3.0/$3.1B, though the miss came entirely from a one-time $298MM cash driver appreciation award related to Uber's IPO (which we understand to have been a one-time event). Management noted that excluding the driver appreciation award, ANR was $3.2B, up 26% Y/Y (ex- FX), an 8-pt acceleration from Q1, attributable to strong MAPC growth and stronger user engagement. Core Platform Contribution Profit of $220MM came in ahead of RBC and improved from a ($117MM) loss in Q1 driven partially by greater shared ride efficiency and a focus on higher margin products. EBITDA loss of ($656MM) came in nicely ahead of RBC/Street, improving from an ($869MM) loss in Q1 due to strong execution across the business."
- Mark Mahaney