With all the problems that ridesharing great Uber (UBER) has been having with its labor over the last few years—not to mention the government involvement—it likely will not prove a surprise to see Uber investing in self-driving vehicle technology. That is exactly what it did when it took a stake in Wayve, and investors were sufficiently pleased to send Uber shares up modestly in Thursday afternoon’s trading.
Uber put an undisclosed sum into Wayve in exchange for a “minority stake,” and Uber will be lending Wayve a hand technologically. Wayve is currently working on what is described as a “general purpose” driving artificial intelligence (AI) that can work as well for a delivery van as it can for a passenger car.
The plan calls for Uber to take Wayve’s AV2.0 technology and install it into consumer vehicles, which, in turn, will “…enable a range of automated driving capabilities.” From there, Uber will make self-driving vehicles available through its own platform, potentially meaning your next Uber ride may just be you in the car.
The $40 Million Dollar Ride
Meanwhile, Uber has another black eye to live down: reports emerged that hundreds of Uber drivers were engaging in surge fare scams to the tune of about $40 million, all told. It is currently being called the “Screwber” affair—a portmanteau of “Screw” and “Uber”—and suggests that drivers took advantage of the “surge pricing” to charge customers extra.
Essentially, the plan called for users to pay surge fees—higher fees during certain times of day—when no such fees should have been assessed. The excess was then pocketed accordingly. The process was facilitated by a combination of hacked smartphones and bogus apps that allowed the practice to go on largely unnoticed until recently. Should those involved be convicted, it could mean up to 20 years in prison.
Is Uber a Buy or Sell Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on UBER stock based on 31 Buys and one Hold assigned in the past three months, as indicated by the graphic below. After a 56.69% rally in its share price over the past year, the average UBER price target of $87.93 per share implies 20.55% upside potential.
