It’s the end of the road for Uber Eats in Hong Kong. Uber Technologies (UBER) has announced that it will no longer offer food delivery services in the city, starting December 31, 2021. UBER shares fell 4.28% to close at $38 on November 30.
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California-based Uber is a transportation networking company that offers ride-hailing services. It also offers a popular food order and delivery business.
Uber Eats Hong Kong
The company is ending the service after five years of operation in the city. According to the South China Morning Post, this is due to slower-than-expected growth in the vertical. (See Top Smart Score Stocks on TipRanks)
Even as Uber ends the Uber Eats service, it has affirmed its commitment to its mobility platform in the city. The city accounts for 25% of the company’s global Uber Taxi business. It now plans to invest more in the Taxi service, in a bid to serve more riders and drivers, going forward.
Stock Rating
Last month, Morgan Stanley analyst Brian Nowak reiterated a Buy rating on the stock with a $72 price target, implying 89.47% upside potential to current levels. The bullish rating follows the unveiling of a unified subscription offering, Uber One.
According to Nowak, Uber One can provide a greater selection of benefits at lower costs, and thus strengthen Uber’s competitive edge.
The consensus among analysts is a Strong Buy, based on 19 Buys and 1 Hold. The average Uber price target of $69.75 implies 83.55%% upside potential to current levels.
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