Assessing Uber Stock After New Jersey Investigation Amid Strong Delivery Growth Projections

If you have been eyeing Uber Technologies stock lately and debating whether now is the right time to buy, hold, or sell, you are not alone. It is one of those names that always seems to get people talking, whether it is a spike at the open, a new partnership, or a headline that stirs debate about ride-share safety. The company’s share price has done some serious work over the past few years. While the last week (-1.2%) and month (-0.7%) have seen minor dips, the bigger picture is impressive, with Uber shares up 46.1% year to date and notching 229.4% over the past three years.

Lately, the news flow has been a mixed bag. On one front, Uber is grabbing headlines with ambitious growth in its non-restaurant delivery business, projecting a 25% jump in gross bookings to hit $12.5B by year-end 2025. On the other, the company is under legal scrutiny, including probes from the New Jersey Attorney General and a Department of Justice lawsuit over its treatment of passengers with disabilities. Market reactions to these stories have been measured so far, which suggests that investors are looking past headline risk and focusing more on Uber’s long-term narrative of mobility, scale, and growth.

The million-dollar question now is whether Uber is undervalued, fairly valued, or getting ahead of itself. According to our valuation checks, Uber scores a 5 out of 6 for undervaluation. That is a strong showing, but what does it actually mean for investors and how are these valuation methods determined? Let’s dig into some of the main valuation approaches, and stick around, because there is an even better way to see if Uber is truly worth your investment dollars.

Uber Technologies delivered 16.6% returns over the last year. See how this stacks up to the rest of the Transportation industry.

Approach 1: Uber Technologies Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model projects Uber Technologies’ future cash flows and then discounts them back to reflect what those future dollars are worth today. This approach aims to estimate the company’s intrinsic value and is independent of market sentiment or temporary price swings.

Uber’s current Free Cash Flow stands at $8.5 billion, and analysts forecast robust annual growth, with projected free cash flow reaching $16.8 billion by 2029. Estimates for the next few years show consistent growth. Projections beyond analyst estimates are calculated using systematic assumptions by Simply Wall St. All values are reported in USD, as per Uber’s reporting practices.

According to this DCF model, Uber’s fair value is estimated at $170.74 per share. This value suggests the stock is trading at a 45.9% discount. Based purely on projected cash flows, Uber’s shares appear significantly undervalued in the current market.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Uber Technologies.

Our Discounted Cash Flow (DCF) analysis suggests Uber Technologies is undervalued by 45.9%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Uber Technologies Price vs Earnings

For companies that are consistently profitable, the price-to-earnings (PE) ratio is a go-to valuation metric because it measures how much investors are willing to pay today for a dollar of current earnings. This multiple is widely used as it offers a quick way to gauge if a stock is expensive or cheap relative to its ability to generate profit.

What is considered a “normal” PE often depends on expectations for company growth and perceived risk. Higher anticipated earnings growth and lower risk typically justify a higher PE ratio, while slower growth or elevated risk tend to push the “fair” PE lower. Uber currently trades at a PE of 15.2x, which is below the industry average of 26.7x and well under the peer average of 37.1x. On paper, this may make it look cheaply valued against its sector and rivals.

Rather than rely solely on the industry or peer benchmarks, Simply Wall St’s proprietary “Fair Ratio” provides a more detailed analysis. This measure blends Uber’s projected earnings growth, profit margins, industry characteristics, company size, and risk. For Uber, the Fair Ratio is 16.8x, which is a more tailored estimate of what the multiple should be given its unique profile. Since Uber’s current PE is quite close to its Fair Ratio, this suggests the market is broadly pricing Uber in line with its fundamentals and outlook.

Result: ABOUT RIGHT

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Upgrade Your Decision Making: Choose your Uber Technologies Narrative

Earlier, we mentioned that there is an even better way to understand valuation. Let’s introduce you to Narratives. A Narrative connects the story you believe about Uber Technologies, including its future prospects, risks, and unique strengths, to a transparent and numbers-backed financial forecast, and ultimately to what you think is a fair value for the stock.

Unlike traditional valuation methods, Narratives make it easy to share your point of view and see others’ perspectives, because each Narrative links your assumptions about Uber’s future revenue, margins, and earnings directly to a live fair value estimate. On Simply Wall St’s Community page, millions of investors discover and discuss Narratives, making this tool both accessible and dynamic.

Whenever new news or earnings are released, Narratives are updated in real time, helping you keep your view relevant. By comparing the Narrative-driven fair value to Uber’s current share price, you can quickly decide whether it is time to buy, sell, or wait.

For example, some investors are cautious, estimating a fair value for Uber as low as $75 per share, highlighting margin risks and calling the current price overvalued. Others see significant opportunity and set a fair value above $108, thanks to high conviction in the company’s growth and strategy.

For Uber Technologies, however, we'll make it really easy for you with previews of two leading Uber Technologies Narratives:

🐂 Uber Technologies Bull Case

Fair Value Estimate: $108.52

Current price is 14.99% below fair value

Revenue Growth Forecast: 14.6%

• Growth is driven by user expansion, cross-platform engagement, and strategic pushes in autonomous vehicles and high-margin services.
• Analysts see robust top-line momentum but acknowledge risks from operational complexity, heavy autonomous vehicle investment, and regulatory shifts.
• The analyst consensus price target is 10.3% above the current share price, reflecting positive conviction despite profit margin headwinds.

🐻 Uber Technologies Bear Case

Fair Value Estimate: $75.00

Current price is 23.07% above fair value

Revenue Growth Forecast: 4.2%

• Recent growth and profitability are acknowledged, but the current share price is seen as significantly overvalued with no margin of safety.
• Fair value range estimated at $65 to $75 per share, implying Uber trades at a 40% or higher premium versus this intrinsic value.
• Cautions that despite strong fundamentals, investors should wait for a better entry point given the premium valuation.

Do you think there's more to the story for Uber Technologies? Create your own Narrative to let the Community know!

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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