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UK stocks have done well recently. However, investors should not ignore global stocks – in markets like the US and Europe there are really attractive opportunities today.
One international stock that I believe is worth watching Uber (NYSE: UBER), listed in the US. Here are three reasons why I am interested in this term.
Top-line growth
Thanks to its powerful product and large global user base (200m users worldwide), Uber has grown at an impressive rate recently. Over the past three years, revenue has risen from $31.9bn to $52bn (18% annual growth).
This is not just a story of high growth, however. Today, Uber is very profitable and generates a ton of cash flow.
Note that with this cash flow, the company buys more shares. This should charge earnings per share going forward.
A major player in the robotics space
Looking ahead, the runway that grows here has a lot of room to work. One key driver of growth could be robotics.
Earlier this week, Nvidia – which has a relationship with the rideshare company – announced that Uber will launch a global network of autonomous vehicles powered by Nvidia, starting in Los Angeles and San Francisco in the first half of 2027 and reaching 28 cities worldwide by 2028. This will be supported by Nvidia’s growing list of automotive partners, Hyundai-Benhich (which includes Hyundai-Benhich).
This partnership is a big deal. It could help the company become the ‘system of choice’ for the global robotaxi industry and beat rivals like Waymo and Tesla.
It is worth noting that Uber has robotaxi relationships with many other companies. Earlier this month, it announced a strategic partnership Amazon– owned by robotics company Zoox.
With this partnership, Zoox taxis will be available on the Uber app, starting in Las Vegas this summer. Other affiliated companies include LucidWaymo, and UK-based Wayve.
I will point out that we don’t know exactly how robotaxis will affect Uber’s revenue. But since there are no human drivers, there is the potential for much lower costs (and higher profits).
Attractive balance
In terms of valuation, it makes a lot of sense today. After a significant decline in share price recently, the stock now trades at a forward price-to-earnings (P/E) ratio of 23, down to 18 using next year’s earnings forecast.
This is not a high repetition. Considering the long-term growth potential here, the stock looks cheap, in my opinion.
It’s worth looking at around $75
Of course, while there are many reasons to be bullish here, there are also risks. Competition from the likes of Tesla and Waymo is something to think about.
Declining consumer spending is another. This can happen if AI leads to the loss of many jobs.
All things considered, I see a lot of appeal in the stock at current levels (near $75). In my opinion, it is worth considering an ISA or SIPP.
