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Uber Stock Rises as UBS Names Ride-Hailer a 'Top Pick'

Uber Technologies shares accelerate after analysts at UBS named the ride-hailing giant one of their top picks and say they expect the shares could more than double.

Uber Technologies  (UBER) - Get Uber Technologies, Inc. Report shares accelerated Thursday after analysts at UBS named the ride-hailing giant one of their top stock picks and said they expect the company's shares could more than double from current levels.

Shares of Uber were up 2.92% at $37.07 in premarket trading following the report from the influential investment bank.

Uber shares have been under pressure following the ride-hailing giant’s posting of its first operating profit as a public company, which still came with a significant net loss due to its investment in China-based ride-sharing company Didi Global  (DIDI) - Get DiDi Global Inc. Report.

Uber said adjusted profit for the third quarter came in at a modest $8 million, enough to put it in the black for the first time, but the net loss and a tepid fourth-quarter outlook kept shares in the red. On a per-share basis, Uber lost $1.28 a share; analysts polled by FactSet had been expecting a loss of 33 cents a share.

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Didi, which went public in June, saw its market capitalization drop by billions of dollarsafter China’s market regulator launched an anti-trust probe. More recent concerns about the Covid-19 Omicron variant and another drop-off in potential ridership also have weighed on Uber’s share price.

Separately, UBS on Thursday raised its price target on Google parent Alphabet  (GOOGL) - Get Alphabet Inc. Class A Report, saying the tech giant’s tock has the potential to jump another 40% over the next 12 months or sooner.

UBS earlier this month unveiled several of its high-conviction picks that it views as “strong pricing power stocks” -- those able to raise prices on products and that have solid margin momentum. The short list includes Apple  (AAPL) - Get Apple Inc. Report, Nike  (NKE) - Get NIKE, Inc. Class B Report and Salesforce  (CRM) - Get salesforce.com, inc. Report, among others.