Uber Pulls Back. Is it the Next Facebook?
Uber Technologies quietly hit a new all-time high on February 11. Now it's pulled back and may be offering some opportunities for the bulls to hail a ride.
First, notice the trend line starting at the low of November 4, as stocks began their election-week rally. UBER jumped two sessions later after announcing results. It continued higher until late January, when it pulled back along with the rest of the market. That low created a trend line, to which prices are now returning.
Next, stochastics have dipped into oversold territory.
Finally, the last four months of consolidation and price action have occurred above the previous highs from 2019 and 2020. In this way, UBER resembles Facebook in 2012 and 2013.
The comparison might be apt because both companies went public with key weaknesses. In case you forgot, FB struggled with mobile ads for several quarters. Mark Zuckerberg fixed that problem mid-2013, resulting in a breakout above its initial price range.
Like FB, UBER spent its 12-18 months in a penalty box as investors balked at its convoluted business model. But CEO Dara Khosrowshahi has divested non-core business and mapped a route to consistent profits last quarter.
Overall, UBER has been through a lot: management turmoil, profitability issues and coronavirus. Now things may finally be coming together for the transportation disruptor to really go places.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
First, notice the trend line starting at the low of November 4, as stocks began their election-week rally. UBER jumped two sessions later after announcing results. It continued higher until late January, when it pulled back along with the rest of the market. That low created a trend line, to which prices are now returning.
Next, stochastics have dipped into oversold territory.
Finally, the last four months of consolidation and price action have occurred above the previous highs from 2019 and 2020. In this way, UBER resembles Facebook in 2012 and 2013.
The comparison might be apt because both companies went public with key weaknesses. In case you forgot, FB struggled with mobile ads for several quarters. Mark Zuckerberg fixed that problem mid-2013, resulting in a breakout above its initial price range.
Like FB, UBER spent its 12-18 months in a penalty box as investors balked at its convoluted business model. But CEO Dara Khosrowshahi has divested non-core business and mapped a route to consistent profits last quarter.
Overall, UBER has been through a lot: management turmoil, profitability issues and coronavirus. Now things may finally be coming together for the transportation disruptor to really go places.
TradeStation is a pioneer in the trading industry, providing access to stocks, options, futures and cryptocurrencies. See our Overview for more.
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