Uber: Jefferies still a buyer

(CercleFinance.com) - Jefferies maintains its Buy rating on Uber shares, along with its $50 target price.


The passage of a bill in the Minnesota Senate yesterday to establish minimum pay rates and other benefits for Rideshare drivers concerns the analyst, however: "We estimate driver costs in Minnesota would increase by ~45% per trip, forcing UBER/LYFT to either increase fares substantially or exit the state".

"While Minnesota only represents ~0.5%/2.0% of Bookings for UBER, successful passage of the bill (requires approval from Minnesota Governor) may embolden lawmakers in other municipalities," Jefferies believes.

"We believe UBER would look to offset the impact of higher driver earnings in Minnesota by making operational adjustments and raising fares, which would negatively impact consumer demand," the analyst continues.


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