Piper Sandler Says Uber (NASDAQ:UBER) Is a “Sleeping Giant”

Normally, an analyst’s bullish rating tends to drive up shares as it causes investors to pile in. But that didn’t happen for ride-hailing company Uber (NASDAQ:UBER) today, as Piper Sandler declared the stock a Buy and increased its price target from $86 to $88 per share. The investment firm even called Uber a “sleeping giant,” which highlights how undervalued its shares are.

The upgrade is due in large part to a new multi-year deal set up with Aurora Innovation (NASDAQ:AUR). Aurora works in the self-driving vehicle space, which likely has implications for Uber’s aspirations in that sector. In fact, some projections say that Uber and Aurora could have a self-driving truck ready to go by the end of this year. This would represent a significant leap forward and a potentially destabilizing element in the trucking sector, given that it employs a very large number of people.

Uber Looks to Lower Minimum Pay

While Uber is working to make self-driving trucks more of a thing, it’s also working on its ride-hailing operations. In fact, it just started a move that’s hitting New York drivers hard, shutting them out of the app altogether during low-demand periods, a move that will ultimately lower minimum pay.

This move limits the amount of time that Uber is paying drivers who aren’t actively driving passengers around, and Uber drivers are noting that this change has cost them as much as half their income, a move that likely won’t sit well with drivers or with regulators, who have already had their eye on Uber before.

Is Uber a Buy or Sell Right Now?

Turning to Wall Street, analysts have a Strong Buy consensus rating on UBER stock based on 29 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 58.89% rally in its share price over the past year, the average UBER price target of $87.86 per share implies 24.57% upside potential.

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