Is Uber Stock A Real Bargain?

October 9th, 2026 · by Trefis Team
UBERYTD-14.0%SPYYTD+14.1%XLIYTD+9.1%
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Uber (UBER) stock trades at 14.9 times earnings, trailing the 22.2 multiple of the median S&P 500 company. The shares have lost 28% over the past twelve months while the broader index returned 17.0%. A discount this deep indicates investors either see an underlying problem or have marked down a healthy business too far. So what does a buyer of Uber stock get at this price?

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Uber Grew Twice As Fast As The Median Company

Despite carrying a P/E ratio 33% below the median company, Uber generates sales at a significantly faster clip. Revenue grew 16.7% over the last twelve months, roughly double the 8.3% rate of the median S&P 500 company. That expansion has cooled over the past four quarters, however, decelerating from a 20.4% year-over-year pace down to 12.2% in the most recent period. The Mobility segment remains the core of the business, accounting for 57% of fiscal 2025 revenue, followed by the Delivery unit.

Uber also translates those sales into cash. Its free cash flow equals 7.1% of its market value. Over the past year, the company allocated an amount equal to 4.8% of that value toward share repurchases. The balance sheet is similarly unburdened: Uber holds debt at just 10.3% of market value, compared to 21.0% for the S&P 500 as a whole.

Did All Of Uber’s Profit Come From Its Operations?

Not all of Uber’s profit actually comes from its operations, which may be one reason investors are paying less for these earnings. Net income over the last twelve months reached $9.6 billion, while operating income stood lower at $6.7 billion. The bottom line has also declined as a share of sales. Uber recorded a 27% net margin a year ago, but that figure has fallen to 17.3% over the latest twelve months.

Core operations are improving, yet its margin still trails the median company’s. Uber posted an operating margin of 12.1% over the last twelve months. This marks a clear increase from its three-year average of 8.9%, but falls short of the 18.5% margin earned by the median S&P 500 company.

Uber Is Cutting Ride Prices And Funding Autonomous Vehicles

Uber plans to fund lower ride prices with cost savings. During the second-quarter 2026 earnings call, management noted the company is putting savings from lower insurance costs back into the market. Uber has since said it will use those savings to reduce ride prices. Executives also pointed out that growth has clearly picked up in California, a region where the company is reinvesting a significant amount.

The impact of these lower prices should materialize in gross bookings, which track the total value of orders placed. That metric topped $58 billion in the second quarter. Looking ahead to the third quarter of 2026, management guided for gross bookings between $58.25 billion and $60.25 billion. The quarter has closed, and investors are currently waiting for the pending results.

Beyond everyday operations, management plans to invest $10 billion in autonomous vehicles over several years. The company stated it will disclose the size of the effect this will have on profit closer to deployment. Uber is deploying capital on acquisitions as well. On October 6, 2026, the company announced an agreement to buy the catering platform ezCater for $2.3 billion in cash. Uber expects the deal to lift its profit margins.

Buying Uber stock at current levels is ultimately a bet that the company can keep raising its operating profit while it pays for that spending. Management guided to third-quarter 2026 adjusted EBITDA, a measure of profit from operations, in the range of $2.86 billion to $2.96 billion. A result above $2.96 billion would show Uber is earning more from operations than planned, even as it cuts prices and funds autonomous vehicles. A print below $2.86 billion would show the opposite.

Does This Mean You Should Act On UBER?

Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.

There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices – the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.

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