What Is The Future Of Modern TAXIS? Uber Stock News and Forecast: UBER CEO buys stock, should you? | FXStreet

What Is The Future Of Modern TAXIS? Uber Stock News and Forecast: UBER CEO buys stock, should you? | FXStreet
  • Uber stock under pressure after dismal earnings earlier this week.
  • UBER stock is down 44% so far in 2022.
  • Uber CEO just bought 200,000 shares for $5.3 million.

Uber (UBER) stock remains mired in depression with bears in total control after earnings earlier this week. The company unveiled a massive loss that led to CEO David Khosrowshahi penning a letter to employees to explain the earnings and what he feels needs to be done to secure the future of the ridesharing company.

Uber Stock News: A loss is a loss

First, here is a quick recap on those earnings numbers. Earnings per share (EPS) came in at $-3.04 versus a $-0.24 estimate. Revenue came in at $6.85 billion versus estimates of $6.13 billion. First, the earnings per share number is not really comparable as it includes losses in UBER's equity investments related to stakes in Didi (DIDI), Aurora and Grab. I never really pay attention to statements such as the one I just made, not comparable. A loss is a loss. It does not matter how you phrase it. It is not a loss attributable to regular operations, however, but it is still a loss. It affects cash flow, balance sheet, etc. IT IS A LOSS. Wall Street analysts – let's get this straight. UBER lost $5.9 billion for the quarter.

Read next: Don't Worry Coffee Lovers! The Price Of Coffee Futures Falling Amidst Current Market Conditions, Crude Oil (WTI) Recovers Slightly, Palladium Prices Show Steady Downward Price Trend | FXMAG.COM

Revenue beat estimates, but what is Uber doing with that money? They invested it and lost $5.6 billion. Well done. UBER CEO David Khosrowshahi then said in a letter to employees, which CNBC got a hold of, that the company would cut back on spending and hiring. Peer LYFT had also produced downbeat forecasts for the ride-hailing sector.

Despite it all though Uber CEO David Khosrowshahi has put his money on the table and stumped up $5.3 million for some UBER shares this week. Usually, insider purchases are more significant than insider sales, and this is not a small amount. Although we should note, he does not have a great track record. Previously, he bought shares at $44.92, so nearly a 50% loss then!

Read next: Earnings Season: (DIS) Disney Stock Price Awaits Earnings Announcements| FXMAG.COM

Should you follow him? Difficult call. We are not as bearish on UBER as some other stocks that soared too high, but UBER is a play on the broad economy. It needs economic activity to remain strong to benefit. If people pull back on spending, UBER will be one of the first things to suffer. Certainly in the short term, we view the risk-reward as being slightly more skewed to the upside now. The bad news is largely in the price, and we may see a short-term bounce if today's CPI is in line.

Uber Stock Forecast

$28.41 remains our key level and is our bearish pivot. UBER returns to neutral above this level. Both the Money Flow Index (MFI) and the Relative Strength Index (RSI) are showing oversold levels, further strengthening our arguments for a short-term relief rally.

Uber Stock News and Forecast: UBER CEO buys stock, should you? - 1

UBER stock chart, daily

FXStreet News

FXStreet News

FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market and was founded in 2000.
 
The website offers a wide range of tools and resources: 24/5 currency news, real-time economic calendar, advanced rates and charts, educational webinars, analysis reports, forecasts, Learning Center, newsletters, industry services, FX customizable studies...
 
As its distinctive trademark, the portal has always been proud of its unyielding compromise to provide neutral and unbiased information and to enable its users to take better and more confident decisions. FXStreet has managed to gain the collaboration of the entire Forex industry, from individual professionals and small companies right up to Forex Brokers and Investment Banks. FXStreet covers the FX Market 24/5: an expert team of journalists, traders and economists picture what the market is doing and what is happening as it happens.