Analysts Expect Uber Technologies, Inc. (NYSE:UBER) To Breakeven Soon

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$94b market-cap company posted a loss in its most recent financial year of US$9.1b and a latest trailing-twelve-month loss of US$374m shrinking the gap between loss and breakeven. The most pressing concern for investors is Uber Technologies' path to profitability – when will it breakeven? In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Check out our latest analysis for Uber Technologies

According to the 42 industry analysts covering Uber Technologies, the consensus is that breakeven is near. They anticipate the company to incur a final loss in 2022, before generating positive profits of US$855m in 2023. So, the company is predicted to breakeven approximately 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 50% is expected, which signals high confidence from analysts. 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, keep in mind that typically a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

Before we wrap up, there’s one issue worth mentioning. Uber Technologies currently has a relatively high level of debt. Typically, debt shouldn’t exceed 40% of your equity, which in Uber Technologies' case is 96%. A higher level of debt requires more stringent capital management which increases the risk in investing in the loss-making company.

Next Steps:

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 important factors you should further research:

1. 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.
2. 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.
3. 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.

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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.