Uber's Earnings Offer Clues on the Stock and Broader Economy

In an investor’s lifetime, only a few companies become so dominant that their names turn into verbs. These brands grow so large and their services become so integrated into daily life that people stop using generic terms for certain actions—instead, they use the company’s name itself.

One such example is Uber Technologies Inc. (NYSE: UBER), a stock that had seen its fair share of bears and doubters over the years, but one that undoubtedly has managed to swing its finances and business model in the right direction, which is especially important in today’s uncertain and volatile stock market.

Closing on the idea of market share, investors can recall how often they’ve referred to someone “Ubering” somewhere, and that’s enough said.

While price action favors Uber stock today, investors need to justify what lies behind this recent price action, and it is that time of the quarter when they can do just that.

As the company releases its latest quarterly financials, investors will get a chance to cover some of the most important factors and developments that could bring Uber stock to higher highs in the coming months and quarters.

Uber Catches a Ride Higher

This technology stock is not that different from most others in its driving factors, ones that investors can start with to build their bullish thesis moving forward. The first set of key performance indicators (KPIs) can be taken from the number of users who rely on Uber’s platform for their transportation needs.

Over the past 12 months, Uber reported monthly active user growth of 14%, which is impressive considering the company's size. Not only are users growing overall, but so is their activity. Uber shows that trips taken (or bookings) grew by a staggering 18% over the year, totaling a high of three billion rides and deliveries.

Now, for the exciting part, all of this additional usage translated into a net revenue level of $11.5 billion, showing a net annual growth rate of up to 14%, which added another layer of double-digit percentage expansion to this business. What’s impressive is seeing such fantastic growth even during a time when the average consumer is as uncertain as ever, thanks to trade tariffs.

That being said, Uber is focusing on the right things, which is delivering value to its users and shareholders alike in order to attract more momentum and buyers to its stock. Today, shareholders are being rewarded by Uber, which delivers up to $2.3 billion in free cash flow (operating cash flow minus capital expenditures).

This metric matters because it is the lifeblood of any business, and its plans to expand and reinvest capital into further value compound down the line. These benefits can, of course, be quantified, and in Uber’s case, they are through a return on invested capital (ROIC) rate of up to 25.2%, considerably high for a company that is still growing by this much.

Uber’s Message on The Economy

The average consumer may still have enough liquidity or credit left to use Uber as a reliable transport source. However much truth there is to that theme, the bulk of growth actually came from Uber’s delivery segment, which is considerably more “cyclical” than transportation needs.

Revenue from transportation pales compared to the 22% growth reported by Uber deliveries, which might have a double meaning. Ordering takeout is not the same as dining out, and ordering through an Uber membership for discounts is not the same as ordering takeout; it’s more frugal and budget-friendly.

So, regarding Uber’s message, maybe the consumer is not in outright depression, but things are getting a bit more defensive today.

The Market’s Path for Uber Stock

A 22.2% rally over the past 12 months and the fact that Uber stock trades at its 52-week high today should tell investors that this name’s bias and momentum are bullish. However, price action is often just the start of something much deeper.

Wall Street analysts currently see a consensus valuation of $89.8 per share on Uber stock, which calls for a net upside potential of 4.3%.

However, before some doubters say that all of Uber’s growth is now priced in, they should look to the highest target set at $115 and the fact that its latest earnings, a standout report, have yet to be fully reflected in updated ratings and valuations.

What can be taken to the bank is the fact that institutional buyers justified a purchase of up to $1.7 billion in Uber stock as of the most recent quarter (made up of April and May 2025 only so far), giving investors another solid fact to lean on when it comes to positive and bullish outlooks.

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The article "Uber’s Earnings Offer Clues on the Stock and Broader Economy" first appeared on MarketBeat.