An Uber Technologies (NYSE:UBER) insider agrees that the stock is a “buy” right now. According to SEC filings, Uber’s director, Robert Eckert, purchased 15,740 shares on June 15. He made the purchase in the open market and paid an average of $31.60 per share. As a result, Eckert invested nearly $500,000 of his own money in Uber stock. On June 19, Uber closed at $32 per share, which placed it up 8.6% for the year. Lyft (NASDAQ:LYFT), which counts Google as one of its corporate investors, has fallen 19% for the year.
Eckert joined Uber’s board of directors in March. Uber shares have gained about 35% since Eckert joined the board. Notably, Eckert joined Uber at the height of the coronavirus outbreak. COVID-19 caused a big decline in ride-hailing demand and sparked a big sell-off in Uber stock.
However, Uber has made an impressive comeback after the sell-off. At $32 per share, Uber has pulled up more than 135% from its pandemic lows of $13.70 in March.
Why has Uber stock rebounded?
Generally, analysts are bullish on Uber stock. Among the 42 analysts that cover Uber, 35 recommend a “buy.” Even after rallying 135% from the pandemic lows and 52% over the past three months, Uber has more room to run. The consensus target price of $40 implies a 25% upside for Uber shares from the current level. Right now, Uber trades at a 45% discount to its 52-week peak of $47.
Uber stock has soared due to its fairly good first-quarter earnings results. The company’s first-quarter revenue rose from a year ago and beat the consensus estimate. However, the EPS missed the expectations because the company had higher costs.
Investors have also piled into Uber stock as coronavirus lockdowns ease around the world. Uber and Lyft reported rebounding ride demand as authorities lift coronavirus movement restrictions. In fact, Uber CEO Dara Khosrowshahi said the worst of the coronavirus might be behind the company.
Notably, Khosrowshahi also sees a pullback in Uber stock as a buying opportunity. In November last year, Khosrowshahi invested $6.7 million of his own money to purchase 250,000 Uber shares. The executive purchased the shares at an average price of $26.75.
Despite the coronavirus disruption, Uber has set its sights on becoming profitable next year. The company has turned to cost-cutting, including workforce reduction, to achieve its profit target.