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RBC Capital reiterated an Outperform rating and $46 per share price target on Uber (NYSE:UBER) in a note Tuesday, stating that driver supply analysis indicates supply outperformance.
“Our latest qtrly U.S. ride-hailing driver supply analysis yielded continued favorable results for UBER relative to LYFT, in our view,” wrote RBC Capital analysts.
The analysts revealed that their analysis showed Uber’s pick-up times got better while rival Lyft (NASDAQ:LYFT) got worse, while Uber’s higher pricing gap widened.
This indicates a growing driver hourly wage advantage, according to Erickson, who added that Lyft continues underperforming in LA, which they believe is a “useful proxy for the presumptive west coast rebound.”
“We continue to favor UBER’s apparent structural advantage, with multiple levers to pull on take rate/EBITDA leverage, which should see Street ests move higher & bears having to increasingly contemplate index inclusion into next year,” they concluded.
