Uber’s Stock Rebounds Two Key Drivers Behind the Surge

Uber Technologies Inc.’s stock surged 5.7% early Monday following two major announcements: the company’s accelerated $1.5 billion share repurchase agreement with Bank of America, part of its previously announced $7 billion buyback program, and its addition to Wedbush’s Best Ideas List.

Chief Financial Officer Prashanth Mahendra-Rajah expressed confidence in prepared remarks, stating, We are entering 2025 with considerable momentum and expect to continue scaling our free cash flows significantly, enabling us to return meaningful capital to shareholders while still investing in growth.

Uber views its stock as undervalued, having risen only 12% over the past year, significantly underperforming the S&P 500, which gained 26.5% in the same period. Over the last three months, Uber’s stock has declined 13%, while the S&P 500 climbed 3.3%. The repurchase deal is expected to be finalized in the first quarter.

Separately, Wedbush analysts highlighted Uber’s attractive risk/reward profile, adding it to their Best Ideas List. They noted the stock trades at approximately 12.8 times their 2026 adjusted EBITDA estimate, despite strong fundamentals, including mid-teen top-line growth and over 30% year-over-year adjusted EBITDA growth projected for the next two years.

Recent pressure on Uber’s stock has stemmed from tempered expectations as performance aligns with projections, limiting near-term upside. Additionally, concerns around automated vehicles (AVs) and their impact on Uber’s core business have weighed on investor sentiment.

Wedbush analysts, however, remain optimistic. We are encouraged by the recent expansion of key partnerships, which will serve as a critical test of Uber’s value proposition for AV providers in 2025, they wrote. They expect the near-term impact of AVs on Uber to be minimal, citing progress on growth initiatives, strong performance in the core business, and limited AV availability.