Wall Street is drawing a clear line in the sand in the fast-emerging robotaxi market, and Uber Technologies (UBER) is winning analyst confidence. With Tesla (TSLA) set to unveil its much-anticipated robotaxi in June, analysts are weighing the potential disruption. However, many believe Uber’s scale, brand dominance, and operational advantage still give it a strong edge.
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RBC Stays Bullish on UBER Stock
Recently, five-star-rated analyst Brad Erickson at RBC Capital is bullish on UBER stock even as Tesla threatens disruption in the autonomous taxi race. Erickson reiterated his Buy rating on UBER, arguing that Tesla’s upcoming cybercab launch in Austin presents “very little risk” for the ride-sharing company.
Erickson remains optimistic about Uber’s long-term outlook, highlighting its strong fundamentals and strategic foothold in autonomous vehicles. He downplayed concerns over Tesla’s upcoming robotaxi launch, suggesting that any disruption it causes could actually serve as a buying opportunity for Uber stock.
It Could be a Win-Win for Everyone
Tesla stands as a disruptive force in the market. If its self-driving technology proves effective, Tesla could deploy millions of vehicles nationwide, providing affordable rides within just a few years. Notably, Tesla is set to launch its robo-taxi service in Austin, Texas, this month, starting gradually but with plans to scale quickly if successful. CEO Elon Musk envisions an Airbnb-style model where a new Tesla in the U.S. could operate as a robo-taxi. Meanwhile, eliminating the driver would drastically cut costs.
Having said that, Uber could integrate Tesla’s purpose-built Cybercab into its fleet or lease self-driving cars owned by others. Uber already partners with Google’s (GOOGL) Waymo, using its autonomous vehicles in select markets.
As the self-driving market expands, Tesla, Uber, and Waymo all stand to benefit from the growing autonomous mobility revolution.
Is UBER a Good Stock to Buy?
Overall, Wall Street has a Strong Buy consensus rating on UBER stock, based on 29 Buys and four Holds assigned in the last three months. The average Uber stock price target of $98.61 implies about 16.5% upside potential from current levels.
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