Analyst Note| Ali Mogharabi |
With the market disappointed with guidance from peer Lyft, Uber's shares have been dragged lower despite the firm’s solid first-quarter results and second-quarter guidance. Also, Uber now expects to generate free cash flow for the full year. In our view, the strengthening of Uber’s mobility segment, the availability of drivers, continuing growth in delivery, and an overall increase in usage of Uber’s platforms by consumers support the firm’s network effect moat source, which continues to drive expanding margins. We have not made significant changes to our model and are maintaining our $73 fair value estimate. We view narrow-moat Uber as an attractive investment.