When Will Uber Technologies, Inc. (NYSE:UBER) Become Profitable?
We feel now is a pretty good time to analyse Uber Technologies, Inc.'s (NYSE:UBER) business as it appears the company may be on the cusp of a considerable accomplishment. Uber Technologies, Inc. develops and operates proprietary technology applications in the United States, Canada, Latin America, Europe, the Middle East, Africa, and Asia excluding China and Southeast Asia. The US$63b market-cap company announced a latest loss of US$9.1b on 31 December 2022 for its most recent financial year result. The most pressing concern for investors is Uber Technologies' path to profitability – when will it breakeven? Below we will provide a high-level summary of the industry analysts’ expectations for the company.
View our latest analysis for Uber Technologies
Uber Technologies is bordering on breakeven, according to the 39 American Transportation analysts. They expect the company to post a final loss in 2023, before turning a profit of US$1.4b in 2024. So, the company is predicted to breakeven just over a year from today. In order to meet this breakeven date, we calculated the rate at which the company must grow year-on-year. It turns out an average annual growth rate of 83% is expected, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.
We're not going to go through company-specific developments for Uber Technologies given that this is a high-level summary, though, bear in mind that by and large a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.
One thing we would like to bring into light with Uber Technologies is its debt-to-equity ratio of 110%. Generally, the rule of thumb is debt shouldn’t exceed 40% of your equity, which in this case, the company has significantly overshot. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.
There are too many aspects of Uber Technologies to cover in one brief article, but the key fundamentals for the company can all be found in one place – Uber Technologies' company page on Simply Wall St. We've also compiled a list of relevant factors you should look at:
Valuation: What is Uber Technologies worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Uber Technologies is currently mispriced by the market.
Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Uber Technologies’s board and the CEO’s background.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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