Uber Technologies, Inc. (UBER): A Bull Case Theory

Ricardo Pillai

Mon, Jul 14, 2025, 1:38 PM 3 min read

We came across a bullish thesis on Uber on Accrued Interest's Substack by Simeon McMillan. As of 9ᵗʰ July, Uber's share was trading at $97.48. UBER's trailing and forward P/E were 17.07 and 41.31 respectively according to Yahoo Finance.

A close up view of a hand holding a smartphone, using a ride sharing app.

Uber has been one of the best performing stocks in 2025, with a 41% increase year to date, outpacing the S&P 500's 2% gain. The company's strong free cash flow conversion and improving earnings have driven the stock's surge. In December 2024, the author was bullish on Uber, citing that investors were too pessimistic about the company's prospects, particularly regarding competition from Waymo and Tesla. The author believed that Uber's multiple of 16x 2026 adjusted EPS was too punitive, and the stock would recover as the market realized its fears were overblown.

The author's thesis proved correct, as Uber's recent quarterly earnings reports demonstrated that 2026 earnings were not at risk, leading to a 37% expansion in the market's P/E multiple. The company's strong performance was driven by its core business, as well as its growing Delivery and Freight segments, which account for 44% of total revenue. The author now expects Uber to trade between $107-$117 per share over the next 12 months, representing a 15-25% increase from current levels. This is based on a 20x multiple of 2027 adjusted EPS or FCF estimates.

The partnership between Uber and Waymo, allowing users to hail Waymo AVs exclusively via the Uber app, has alleviated concerns about competition from autonomous vehicle companies. With Uber's strong free cash flow conversion, now over 100%, and its growing earnings, the company is well-positioned for continued growth. The author recommends Uber as an Outperform, citing its attractive valuation and potential for significant upside. The stock's recent performance and outlook suggest that the company's best days are ahead, making it an attractive investment opportunity.

Previously, we covered a bullish thesis on Uber by  Capitalist Letters published in June 25, which highlighted indirect network effects that are being builtng an insurmountable moat that subscale rivals cannot breach. Since then, the stock has appreciated by 17.7% The current thesis by Simeon McMillan shares a similar view on Uber, emphasizing its strong free cash flow conversion and improving earnings.

Uber is on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 145 hedge fund portfolios held UBER at the end of first quarter which was 166 in the previous quarter. While we acknowledge the risk and potential of UBER as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.