Shares of Uber Technologies Inc (NYSE:UBER) jumped 4.6% on Thursday after the company announced a new deal that will allow the app to list New York City taxis on its app for the first time.
In addition to the potential lucrative taxi partnership, Bank of America analyst Justin Post said Thursday that the latest data on Uber's pricing, wait times and engagement suggest rising gas prices aren't holding back Uber's COVID-19 pandemic recovery.
The Numbers: Bank of America recently surveyed 1,500 Uber rides across 10 different U.S. cities and compiled data on the latest trends. Post said Uber's average price per mile in the month of March, including its recently-imposed 45-cent to 55-cent gas fee, has been $4.22. That price is up slightly from an average of $3.54 in January and February, but Post said it is only slightly above Uber's historical pricing range.
Related Link: Uber Analyst Bullish Following Guidance Update, Says Rising Gas Prices Not A Threat
Post also found Uber wait times are up slightly in March. Uber passengers are currently waiting for an average of 4.1 minutes for a ride in Tier 1 markets, up from 3.6 minutes in January and February. However, the average Uber wait time is still down from 4.8 minutes in the fourth quarter of 2021.
Finally, Post reported the Uber app's daily active user count has been relatively stable since gas prices started to rise. Uber has averaged 1.32 million DAUs in March, down slightly from 1.36 million in February but up 59% from a year ago.
How To Play It: Post said the latest data suggests Uber investors shouldn't be sweating higher prices at the pump.
"Ultimately, we have noted that mobility in Urban areas is improving in March, and we think [the] industry could pass through higher prices," Post said.
Bank of America has a Buy rating and a $55 price target for Uber stock.
Benzinga's Take: Uber's ridesharing business should see tremendous growth in 2022 as city residents return to businesses, social events and restaurants. Meanwhile, Uber generated tremendous growth in its Uber Eats food delivery service during the pandemic and it seems to be maintaining a significant portion of that business even in a post-pandemic economy.
Photo: Courtesy Uber
