Oppenheimer analyst Jason Helfstein reiterated an Outperform rating on the shares of Uber Technologies, Inc. (NYSE: UBER), raising the price target to $65 from $55 on higher peer valuations and confidence in consumer tailwinds.
The analyst believes UBER will continue to benefit from a spending shift from goods to services normalizing, exposure to the strongest consumer categories, and return-to-work tailwinds.
UBER expects gross bookings to increase by +15% in 2Q as it is positively exposed to favorable consumer spending verticals. Categories driving gross bookings, including travel and restaurants, are forecasted to grow 15% this year.
Shares also stand to benefit from inclusion into the S&P 500, which could happen as early as December, Helfstein notes.
The analyst remains confident as index inclusion generally increases demand for a stock, forcing mutual and index fund buying.
These apart, the analyst applauds UBER's superior network liquidity and leading logistics technology. The company's market share in ride-sharing (currently less than 1% of $6.1T TAM) and online food delivery (15% of TAM) remain underpenetrated globally.
Helfstein also expects UBER to expand into new markets with improved freight offerings, new transportation solutions (New Mobility), and positive traction.
Price Action: UBER shares are trading higher by 1.11% to $42.64 on the last check Wednesday.