Jefferies analyst John Colantuoni has raised price targets on Uber Technologies, Inc. UBER and Lyft, Inc. LYFT ahead of earnings in the coming weeks. Here’s what you need to know.
Jefferies On UBER: Colantuoni maintained a Buy rating on Uber on Tuesday and raised the price target from $100 to $105.
Colantuoni’s expectations for Uber’s upcoming earnings report remain high, as he believes the company is somewhat shielded from macroeconomic trends due to its skew toward high-income customers.
In addition, the analyst anticipates strong EBITDA and ride bookings results, which he believes will enhance confidence in the company’s ability to achieve its three-year outlook and justify a higher multiple.
In the company’s most recent quarter, Uber guided for adjusted EBITDA of $1.58 billion to $1.68 billion and gross bookings between $40.25 billion and $41.75 billion for the third quarter.
Colantuoni also noted that he’s on the lookout for further insights into the company’s autonomous vehicle partnerships. The analyst anticipates a renewed focus on Uber’s fundamentals following Tesla’s “underwhelming” robotaxi event.
Uber is due to report earnings for the third quarter on Oct. 31. Analysts expect Uber to report EPS of 39 cents and revenue of $10.97 billion, according to estimates from Benzinga Pro.
Jefferies On LYFT: Colantuoni maintained a Hold rating on Lyft and raised the price target from $10.50 to $13.
Lyft is scheduled to report earnings on Nov. 6. The company is expected to report EPS of 19 cents and revenue of $1.44 billion for the third quarter, according to Benzinga Pro estimates.
Colantuoni said he will be watching for evidence that Lyft can maintain market share over time, especially after the company issued “aggressive” three-year targets at its Investor Day earlier this year.
“We believe the market will otherwise remain skeptical of a 3-year outlook that assumes limited pricing growth and implies Gross Margin expansion is dependent on increased Media penetration (and lower incentives) to offset insurance inflation, despite mobility advertising being relatively nascent,” the analyst said.
Lyft’s guidance for the third-quarter included expected gross bookings of $4 billion to $4.1 billion and adjusted EBITDA between $90 million and $95 million. Colantuoni said he will also be watching for bookings and EBITDA guidance moving forward, mobility trends and pricing, marketing spend, impacts of insurance renewals and any robotaxi commentary.
Price Action: At the time of writing, Lyft stock was down 1.92% at $13.77 and Uber stock was down 0.11% at $80.27, according to data from Benzinga Pro.
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