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Shares of Uber are attractive after a 44% fall this year, an analyst says.
Justin Sullivan / Getty Images
Internet stocks have outperformed the general market because investors are worried about the possibility of a massive recession. But RBC Capital Markets says sales are now a buy-in opportunity.
The
The first belief is Dow Jones
The Internet Index Fund (Ticker: FDN), which tracks the performance of the Dow Jones Internet Composite Index, has declined by 40% this year, compared to
S&P 500
Of
19% drop.
Analyst Brad Ericsson wrote on Thursday, “After the killings in the first Internet reporting season, we zoom out to identify names that appear to be more dusty versus where there is a greater risk,” analyst Brad Ericsson wrote on Thursday.
Analysts say the valuation has become too pessimistic compared to the fundamentals of some companies. Some internet stocks may be more resilient, he noted, despite the deteriorating economic environment in the second half of the year.
As a result, analysts have reaffirmed its outperform rating
Booking Holdings
(BKNG) with a target price of 2,800,
Meta platform
(
FB
) With a মূল্য 240 price target, and
Uber Technologies
(UBER) with মূল 46 price target.
There are signs that the travel business will be strong for the foreseeable future. Earlier this month, bookings reported better-than-expected first-quarter earnings. Its management says it is preparing for a “busy summer travel season”. Ericsson expects the online travel agency to gain more market share in the United States and to benefit from growing cross-border international business.
And Wednesday,
Target
(TGT) Management has told investors that it has seen consumers dramatically shift their spending away from physical goods to the “going out” experience, which could be good for travel.
Regarding Meta, the analyst said he was surprised by recent conversations with advertising agencies that have suggested a tough spending trend on Facebook’s social media platform.
“FB was called by many respondents as potentially better insulators than other ad players,” he wrote. Ad agencies have cited “FB spending as a potential cut in advertising spending in the event of a broad recession.”
Finally, Ericsson believes that Uber shares are attractive after a 44% fall this year. The company “has structural advantages based on driver supply, higher incentives are now coming to risk-free, powerful travel tailwinds.” It will also help that the ride-hailing company emailed its employees earlier this month so they could reduce marketing costs to reduce hiring and improve profitability.
Enter Tae Kim at [email protected]
