Uber is much more than you think, this investor says

In an appearance on BNN Bloomberg Market Call on March 31, Propellus Wealth Partners portfolio manager and senior wealth advisor Mike Vinokur said he likes Uber Technologies (Uber Technologies Stock Quote, Chart, News, Analysts, Financials NYSE:UBER) because the market still underestimates the strength of its network and the number of businesses that platform could support over time.

Vinokur said investors often still think of Uber mainly as a ride-hailing company, but he sees it more as a capital-light infrastructure platform. He said Uber benefits from a large and diversified customer base across rides, Uber Eats and subscriptions such as Uber One, while continuing to add new services and adjacencies.

“We think of Uber as a matchmaker,” he said. “They’re matching the passenger or the delivery restaurant with the person that wants the service, and they’re collecting a toll booth.”

The fund manager said that model is attractive because Uber does not own the vehicles and can use its scale to expand into other businesses at relatively low cost. Vinokur pointed to areas such as advertising, referral revenue and rentals as examples of additional monetization opportunities that could emerge from the platform. He also referenced the company’s autonomous driving partnerships as part of the broader case for Uber using its network and customer reach to extend into new services without having to build the underlying hardware itself.

Vinokur also noted Uber’s recent move involving Blacklane, a Berlin-based chauffeur platform that operates in more than 500 cities across over 60 countries, saying it adds to the company’s global reach and broadens its service offering.

Uber shares have fallen 1.88% over the past 12 months but are up 31.01% over five years. Among analysts covering the stock, 53 rate it “Buy,” eight rate it “Hold” and one rates it “Sell,” with a consensus price target of US$104.51.

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