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In a recent research report, "5 Stocks to Own for the 2024 Elections and Beyond", companies were profiled that could benefit from several macro global equity market and economic themes. From expected extreme near-term spikes in U.S. stock market volatility to global trade and worldwide megatrends such as the tech revolution, market and economic developments are unfolding. The five companies noted are potentially positioned to gain. One of them is Uber. As a holding in Blackhawk Asset Management's Strategic Growth portfolio (BAMSG), Uber has added value by outperforming the market so far this year with a 26.4% gain (through October 9)
The image above from my phone sums up Uber's potential long-term growth. The company's services cover the bases: "Go anywhere." "Get anything delivered." And, "Get anything done." Uber stock would have likely been a market-beater since its public issuance, but the unfortunate timing of its IPO prevented that. With an ill-fated market debut date of May 10, 2019 at $45, Uber stock was crushed by Covid-19. The stock fell to below $14 in early March of 2020. From its stock price recovery starting March 13, 2020, Uber has more than doubled the return of the SP 500 by soaring 244.56% vs 113.65% for the index, through yesterday.
$163 billion and growing...
With its market capitalization recently breaching $160 billion, Uber's growth story may be far from over. The company consistently delivers solid mid-teen top-line sales growth and has shown explosive earnings gains. Margins are improving and free cash flow is increasing. Beyond solid fundamentals, the company is expanding geographically and experiencing strong international traction. Whether ride-hailing or delivery, Uber has managed to disrupt established markets, and with 85% of its major markets being already profitable, it’s hard to question the company's strategic vision. That vision is clear when it comes to the future of autonomous vehicles and robotaxis. Strengthened by its market penetration, strategic advantages, and platform presence, the company is working to benefit from the technological shift. Uber and Waymo (owned by Google) announced an expansion of their existing partnership to make the Waymo Driver available to more people via Uber. Then there's deliveries. Uber Eats is the most popular food delivery service internationally, with 88 million users currently. In 2023, Uber Eats generated $12.1 billion in revenue, which is an 11% increase from the previous year. In Q1 2024, Uber Eats saw $17.7 billion in gross bookings, which is an 18% increase from the previous year.
As the company is well positioned to benefit from the ongoing macroeconomic and monetary shifts moving toward the elections and beyond, Uber is worthy of the list of stocks to hold for the long-term.
John J. Gardner, CFP®, CPM®
3860 Blackhawk Rd, Ste. 160
Danville, Ca. 94506
888.985.PLAN (7526)
https://blackhawkwealthadvisors.com/
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