Why This Analyst Thinks Uber Is Set For A Strong Q2

Bank of America analyst Justin Post maintained a Buy rating on Uber (UBER), raising Q2 and full-year 2025 estimates, citing anticipated strong Mobility and Delivery trends, favorable foreign exchange, and successful autonomous vehicle partnerships. Post projects Q2 gross bookings at $47.1 billion, 2% above Street consensus, and lifted 2025 gross bookings to $190 billion and EBITDA to $8.62 billion, all exceeding expectations. Despite Uber's 44% YTD stock gain, he views the valuation as attractive at 17x EV/EBITDA, significantly below FANG peers' 43x, and anticipates a superior 2026 EPS growth rate of 26%, suggesting continued upside.

Analysis

A bullish outlook from Bank of America Securities anticipates Uber will report a strong second quarter, with analyst Justin Post raising estimates and reiterating a Buy rating with a $115 price target. The firm projects Q2 gross bookings will reach $47.1 billion, 2% above consensus, driven by robust 19% constant currency year-over-year growth. This growth is supported by accelerating trends in both the Mobility segment, projected at 20% Y/Y growth, and Delivery, forecasted at 19% Y/Y growth, which is being amplified by the success of the Uber One membership program and a 60% Y/Y Q1 expansion in the high-margin advertising business. Looking forward, the analyst has increased full-year 2025 estimates for gross bookings, revenue, and EBITDA to $190 billion, $51.1 billion, and $8.62 billion respectively, all above current Street expectations. Despite a 44% year-to-date stock appreciation, the valuation is presented as attractive, with Uber trading at 17 times EV/EBITDA, below its four-year average of 22 times, and at a significant discount to FANG peers on a free cash flow basis, while projecting a superior 26% EPS growth rate for 2026.

Key Decisions for Investors

• Given the analyst's expectation for an earnings beat and a valuation discount relative to historical averages and peers, investors may view the current price as an attractive entry or accumulation point ahead of the August 6th earnings report.
• Monitor Q2 gross bookings closely, as the outperformance relative to the Street's $46.4 billion forecast will be a key test of this bullish thesis.
• Investors should assess the stock's valuation not just on its recent run-up but on its forward growth and cash flow metrics, particularly its 18x FCF multiple versus FANG peers at 43x, which underpins the argument for further upside.
• Pay close attention to management's commentary on the Uber One program, advertising revenue growth, and progress in autonomous vehicle partnerships, as these are cited as crucial medium-term growth drivers.