Publish date:

Uber, Twitter, and Robinhood: 3 Things to Watch Into Happy Hour

Uber's acquisition, Twitter and Snap posted earnings and a look at Robinhood's IPO popularity: Here's what TheStreet's Katherine Ross is watching on Thursday, July 22.

Let's give you a quick market recap before we dig into some stocks.

The Dow Jones Industrial Average finished up 25 points, or 0.07%, to 34,823, the S&P 500 gained 0.2% and the Nasdaq ended up 0.37%.

TheStreet's Joseph Woelfel noted that the yield on the benchmark 10-year Treasury fell Thursday to 1.26%. Yields dropped below 1.2% earlier this week as traders pared bets on any near-term moves on interest rates from the Federal Reserve.

Uber's Big Bet

One of my favorite parts of business journalism is M&A activity. 

Ironically, one of my least favorite parts is trying to guess what a deal means for a company. 

So, I'm going to stay away from that and instead focus on facts here. 

Uber  (UBER) - Get Uber Technologies, Inc. Report has announced that it will be buying Transplace, a transportation management company, for $2.25 billion. 

The company will help push Uber Freight--its trucking division--further along, and perhaps even accelerate the Freight division's path to profitability. 

“The demands of a volatile market and the increasing complexity of globalized logistics are clashing with industrial-age transportation technology,” Uber and Transplace said in a joint press release Thursday.

“In the midst of capacity constraints and escalating transportation costs, shippers are adapting their operations at an increasing pace and looking for technology, support, and solutions that can modernize their supply chain and keep critical goods, and the economy, moving," the companies added.

So, I'm looking at Uber not just because of this acquisition but also because this is just one more acquisition for Uber, who has been piling them up since CEO Dara Khosrowshahi, took the reins.

They've been on a bit of a spree--acquiring Careem in Jan. 2020, Postmates in Dec. 2020, Drizly in Feb. 2021.

Adding in Transplace, Uber has spent a whopping $9.1 billion on its major acquisitions in the past two years. 

I should note, however, that not all of these deals were just cash. For example, the Transplace deal is $750 million in stock and the remainder in cash.

But one thing is interesting here: These acquisitions are being made either at the same time or right after Uber shed two segments of its business that ate up profit--the flying taxi segment and self-driving unit.

This is, I want to note, also at a time where a Google search will gather hundreds of articles and posts questioning the prices of an Uber and whether or not profitability is in the cards for a company like Uber.

Uber seeks to reach profitability on an adjusted EBITDA basis by the end of this year. 

TheStreet Recommends

I'm curious to see if this acquisition helps Uber in the long-run and how much of a focus Freight will get in comparison to Uber Eats. 

Twitter and Snap Earnings

Let's catch up on some earnings, shall we?

Twitter  (TWTR) - Get Twitter, Inc. Report posted revenue that totaled $1.19 billion in the quarter, up 74% from $683.4 million last year. The FactSet analyst consensus called for $1.07 billion in the latest quarter.

Net income registered $65.65 million, or 8 cents a share, swinging from a loss of $1.38 billion, or $1.75 per share, a year ago.

“Our increased shipping cadence contributed to reaching 206 million average monetizable daily active users in the second quarter, up 11% year over year [from 186 million] and 3% quarter over quarter [from 199 million],” said CEO Jack Dorsey in a statement.

There's also this:

Okay, on to Snap  (SNAP) - Get Snap, Inc. Class A Report:

The social media company reported a net loss of 10 cents per share on revenue that increased 116% to $982 million. Analysts polled by FactSet were expecting a second-quarter net loss of 18 cents per share on revenue of $845.6 million. 

"Our second-quarter results reflect the broad-based strength of our business, as we grew both revenue and daily active users at the highest rates we have achieved in the past four years," said CEO Evan Spiegel in a statement.

The company said it is "pleased" with the progress the team is making with its augmented reality platform.

But the winner here is the 293 million daily active users that Snap reported, which is up from the 280 million reported in April.

So, let's recap: Snap impresses with the daily active users and Twitter posts the fastest revenue growth since 2014. 

It's Thursday: My Real Money Column of the Week

And this week, I'm focusing on Robinhood. 

TheStreet's Jim Cramer said, earlier this week, that Robinhood would be a stock that draws in retail investors

And it might. But I wasn't so certain that it could draw in the newer retail crowd. And I don't doubt that it could have a successful IPO, but how much institutional money will be behind it? 

I decided to dig into whether or not Robinhood would actually appeal to the newer retail investor--especially the Reddit crowd. 

You can read my takeaways here.