Yandex Enters Scooter Rental Business

Russian tech giant Yandex (YNDX) has launched an electric scooter rental service in parts of Moscow and plans to expand it to more areas over time. The service is available through the company’s Yandex.Go app.

The app will help customers locate a scooter after selecting a city. First-time customers will be required to view an instruction video on how to navigate safely. Yandex plans to launch an educational program targeting first-time users of electric scooters. (See Yandex stock charts on TipRanks).

Yandex’s scooters are designed to automatically slow down once they reach designated “slow zones.” The company will charge 50 rubles plus a tariff that starts from 6 rubles per minute to rent a scooter. Before July 31, Yandex scooter riders will receive 100% cashback for the first trip with Plus points. Subsequent trips will offer riders a 25% cashback.

The company offers customers life and health insurance cover of up to 100,000 rubles during scooter rides.

In May, VTB Capital analyst Vladimir Bespalov reiterated a Buy rating on Yandex stock and raised the price target to $90 from $87. Bespalov’s new price target suggests 25.30% upside potential.

“Along with the development of logistics and upgrading its IT infrastructure for e-commerce, which might take some time, this is likely to strengthen the platform. As a result, we believe Yandex will be prepared for the next stage of e-commerce development, when market share gains will result less from the ability to meet skyrocketing demand, but rather from the ability to become the platform of choice,” commented Bespalov.

Consensus among analysts is a Strong Buy based on 3 Buys. The average Yandex price target of $86.83 implies 20.88% upside potential to current levels.

YNDX scores an 8 out of 10 on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations.