Hook and thesis
Uber has been quietly converting optionality into tangible business lines. The company is simultaneously expanding Delivery across seven new European markets, rolling up local assets such as Getir's food business in T rkiye, and moving from pilot rows of robotaxi demos to a limited commercial robotaxi operation in Abu Dhabi. Those arent buzzwords anymore - they are concrete expansions that can re-rate the company if they scale. At $72.60, the stock trades at a modest multiple relative to its cash generation and still leaves room for upside if autonomy and AI lower operational costs and push gross bookings higher.
My trade idea: take a controlled-long position sized to risk appetite with a clear stop at $62 and an initial objective of $100 over a long-term holding period of 180 trading days. The thesis rests on three pillars: 1) strong core cash flow and attractive margins, 2) network effects that favor large incumbents as they broaden services, and 3) concrete AV and AI commercialization milestones that can create optionality without asking investors to pay a speculative premium today.
Why the market should care - business & fundamentals
Uber operates three core segments: Mobility (ride-hailing), Delivery (meals, groceries), and Freight. The platform connects riders, couriers, and carriers with demand through software - a low-capex marketplace that can leverage AI to increase utilization and, over time, autonomy to lower labor input costs.
Key fundamental numbers to anchor the view:
- Market capitalization roughly $150.9 billion and enterprise value about $149.97 billion.
- Reported free cash flow is meaningful at about $9.09 billion, giving Uber flexibility to invest in AV/AI and tuck-in M&A without dependent financing.
- Profitability metrics are solid for a growth tech platform: trailing P/E near 14.9 and return on equity ~37.2%.
- Balance sheet is healthy: debt to equity roughly 0.39 and current/quick ratios around 1.08, indicating manageable leverage versus peers that run higher capital intensity.
Those numbers matter because they show Uber can fund R&D and strategic expansion while returning to investors a clearer path to durable free cash flow. The market isn't being asked to pay a sky-high multiple today: price to sales is ~2.82 and EV/EBITDA sits near 23.8, which is neither dirt-cheap nor frothy for a firm with multiple durable revenue engines.
Support from recent operational and market moves
- Geographic expansion: Uber announced plans to expand Delivery into seven additional European markets targeting $1 billion in gross bookings over three years (announced 02/16/2026). That is a scale target that, if achieved, will increase addressable market and improve unit economics through higher density.
- Robotaxi commercialization: Uber launched a commercial robotaxi service in Abu Dhabi with partner WeRide (reported 02/12/2026). Commercial deployment validates engineering and regulatory readiness in at least one jurisdiction and creates a playbook for future rollouts.
- Strategic partnerships: Ongoing partnerships with infrastructure and chip partners like Nvidia lower the friction for scaling autonomous delivery and autonomous ride services. Those partnerships accelerate time-to-market without heavy upfront capital commitments.
Valuation framing
At roughly $150.85 billion market cap and a P/E under 15, Uber is priced more like a mature platform than a pure-growth AI darling. That is notable because the company still carries significant optionality on autonomy and delivery expansion. Free cash flow of about $9.09 billion anchors a moderate intrinsic valuation, and a healthy ROE of ~37% suggests management is extracting high returns on equity capital.
Compare Ubers EV/EBITDA of 23.8 to typical software/platform peers that trade higher when growth is faster; here Uber sits in a middle ground - not cheap relative to legacy transportation, but attractively valued given the potential for margin expansion if autonomy lowers driver costs and AI improves matching efficiency.
Technical backdrop (short-term context)
- Price is $72.60 with 10-day SMA around $72.66 and 50-day SMA near $81.08, indicating the stock has retraced from its autumn highs around $102.
- RSI about 35.8, suggesting the stock is closer to oversold than overbought on a momentum basis.
- Short interest sits in the ~47M range with days-to-cover near 2.33, implying limited structural short pressure.
Catalysts that could re-rate the stock
- Autonomy commercial milestones: meaningful revenue or bookings contribution from robotaxi or autonomous delivery in additional jurisdictions (e.g., North America or Europe).
- Delivery scale: the announced push into seven European markets and the Getir tuck-in in T rkiye producing visible gross bookings growth and margin improvement.
- Partnership announcements or low-cost access to L4 hardware/software that materially lowers unit operating costs.
- Better-than-expected margin expansion or sustained free cash flow growth; note free cash flow is already substantial at ~$9.09B.
- Regulatory clarity or favorable rulings around autonomous operations in large markets.
Trade plan - actionable setup
This is a long trade sized to a risk-managed allocation. I view this as a long-term tactical position that benefits from operational progress rather than binary hype around autonomy.
| Component | Plan |
|---|---|
| Entry price | $72.60 |
| Stop loss | $62.00 |
| Target price | $100.00 |
| Time horizon | Long term (180 trading days) |
| Risk level | Medium - defined downside protection with upside tied to execution |
Rationale: Entry near $72.60 buys a company with meaningful cash generation and clear product optionality at a P/E around 15. Stop $62 protects capital below the recent structural support zone and gives room for short-term volatility while capping downside to about 14.6%. Target $100 reflects a re-rating toward prior highs as autonomy and delivery scale show measurable financial impact.
Risks and counterarguments
Any investment in Uber mixes platform durability with execution risk. Key risks to monitor:
- Autonomy timeline slips - AV commercialization is capital- and time-intensive. If deployment timelines slip or costs remain high, the optionality value could be pushed out years, limiting re-rating potential.
- Regulatory hurdles - Autonomous vehicles and delivery robots face evolving regulations. Any restrictive rulemaking in major markets could derail rollouts and materially raise compliance costs.
- Profitability pressure from competition - Delivery and mobility are competitive markets with margin pressure. Local players and low-price entrants could force promotions and compress unit economics.
- Macro sensitivity - Mobility volumes are cyclical and sensitive to consumer discretionary spending. A macro slowdown would reduce rides and deliveries and squeeze revenue growth.
- Execution risk in M&A and integrations - Expansions like the Getir business integration in T rkiye require smooth execution; missteps could increase costs and distract management.
Counterargument
Critics will say Uber's autonomy investments are speculative and the company should simply return cash or focus on core margins. That argument has merit: if autonomy never achieves cost-per-ride parity with human drivers, the upside from robotaxis will be limited and the stock should trade closer to legacy transportation multiples. In that scenario, a lower corporate multiple (and perhaps lower target price) would be warranted.
However, two points temper that counterargument: 1) Uber is already generating robust free cash flow (about $9.09B) so it has optionality without sacrificing the core business, and 2) the company is monetizing other adjacencies like Uber for Business and dealer partnerships that diversify revenue before autonomy is fully proven.
What would change my mind
I would reduce conviction significantly if any of the following occur:
- Free cash flow materially declines quarter-over-quarter and management cuts investment into delivery or AI to preserve liquidity.
- Regulators block commercial robotaxi operations in additional markets or enforce restrictive rules that make unit economics infeasible.
- Gross bookings from the European Delivery expansion materially miss targets and unit economics there deteriorate.
Conclusion
Uber sits at an attractive cross-section of low-single-digit top-line growth risk and high optionality from AI and AV developments. At $72.60, investors can buy exposure to a networked platform that is profitable on a FCF basis and still has meaningful runway to scale new revenue engines. The trade offered here balances upside from autonomy and delivery expansion against a strict downside guardrail. Keep position size appropriate to your risk tolerance and watch the upcoming operational catalysts closely; execution, not headline noise, will drive the re-rating.
Key short-term items to watch
- Operational updates from robotaxi pilots and expansion plans into new jurisdictions.
- Quarterly commentary on Delivery growth in the seven European markets after the 02/16/2026 announcement.
- Any partnership or cost-sharing agreements around AV hardware or AI compute that materially reduce capex per vehicle.