Is Uber Technologies a Buy, Sell, or Hold in 2025?

Core Viewpoint - Uber Technologies has experienced stock volatility in 2024, ending the year with a 2% decline, despite strong growth in ride-hailing and delivery services, influenced by regulatory concerns in the last quarter [1][2]. Group 1: Company Performance - Uber's monthly active platform customers (MAPCs) increased from 111 million in 2019 to 171 million in 2024, with annual trips rising from 6.9 billion to 11.3 billion [3]. - From 2019 to 2024, Uber's gross bookings grew at a compound annual growth rate (CAGR) of 20%, while revenue rose at a CAGR of 25% [3]. - The company faced a significant slowdown in 2020 due to the pandemic but rebounded strongly in the following years [4]. Group 2: Financial Metrics - In 2024, Uber's trips growth was 19%, gross bookings growth was 18%, and revenue growth was 18% [4]. - Uber achieved profitability on a GAAP basis in 2023, with net income increasing more than fivefold in 2024, and adjusted EBITDA rising by 60% [6]. - For Q1 2025, Uber anticipates bookings to increase by 17%-21% year-over-year, with adjusted EBITDA expected to grow by 30%-37% [7]. Group 3: Strategic Initiatives - Uber has expanded its services, including new enterprise, healthcare, and teen-oriented offerings, and its Uber One subscription service grew by 60% to 30 million subscribers in 2024 [5]. - The company plans to test more autonomous vehicles, which could reduce labor costs in the future [8]. Group 4: Regulatory Challenges - Uber is currently facing two probes from the Federal Trade Commission (FTC) regarding its subscription practices and claims of underpaying drivers in New York City [9]. Group 5: Market Outlook - Analysts project Uber's revenue and adjusted EBITDA to grow by 14% and 32%, respectively, in 2025, and by another 14% and 22% in 2026 [10]. - With an enterprise value of $154 billion, Uber appears undervalued at 3 times projected sales and 18 times adjusted EBITDA [10]. - The company is viewed as a strong growth candidate with a wide moat and economies of scale enhancing profitability [11].