CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please consider our Risk Disclosure Notice and ensure that you fully understand the risks involved.

Can Uber shares really become Deutsche Bank’s top pick for 2021?

The Uber share price began to rise on January 4, thanks to a favourable forecast from Deutsche Bank. The company is placing focus onto its rideshare technology, which could give Uber shares a ‘meaningful upside’ in 2021.

  • Deutsche Bank picks Uber as a top investment pick for 2021.
  • Upgraded forecast fuels 3.4% daily surge for the Uber share price.
  • Rideshare software could make Uber a global leader in travel.
  • Want to trade Uber shares? Open an account today.

The expectation in the short-term is that continued COVID-19 restrictions could give investors a less than smooth ride. However, the investment bank sees a positive H2 on the horizon as vaccinations pave the way for a return to ridesharing. The Uber share price has rallied off the back of this assessment. After opening at $52.22 on January 4, shares took a sharp drop before climbing to $54.01 on January 5. That’s only marginally off the company’s highest ever share price of $54.86.

Uber shares spike after CEO looks to Amazon for inspiration

Fuelling the positive sentiment from Deutsche Bank is Uber’s commitment to becoming the ‘Amazon of transportation’. The comment from CEO Dara Khosrowshahi signals a change in direction for the company. After abandoning its self-driving vehicle hire project in late 2020, Uber sold its fledgling flying taxi service, Elevate, to Joby Aviation in December. The move away from creating hardware coincides with putting more resources into software development.

Khosrowshahi’s aim to become the global leader in mobility and delivery has prompted analysts to reconfigure their expectations. Deutsche Bank has subsequently upped its Uber share price target from $54 to $80, citing rideshare and improved profitability from deliveries as the primary reasons.

Post-COVID position could strengthen Uber

In essence, Uber is aiming to provide software that will underscore the post-COVID era in travel and delivery. As vaccine rollouts breakout around the world, hopes that life will return to normal in the second half of 2021 are growing. However, with every major economy suffering sharp declines over the last 12 months, businesses will have to adapt. This will be par for the course at Uber HQ.

The company was forged in the fires of the global financial crisis. Since 2009, it’s changed the way many people use taxis and, more recently, how food deliveries happen. In the wake of COVID-19, when the average consumer has less to spend, Uber has the experience and technology to make certain services cheaper. It’s already doing this in London. By tapping into open data sources, Uber Ferries is offering a more efficient water-bound taxi service.

Is a strong second half incoming?

It’s this ability to tweak, rather than completely disrupt industries, that’s prompted analysts to reconsider their positions on Uber shares. A major uncertainty in the current equation is vaccinations. However, as more people are given protection against COVID-19, Deutsche Bank sees a positive upside in H2.

How to trade UBER: long or short

What are your thoughts on Deutsche Bank’s latest UBER price target? Whatever your view, you can use CFDs to trade indices, currencies and equities – both LONG or SHORT – with IG’s easy to use trading platform now.

For example, to buy (long) or sell (short) the UBER using CFDs, follow these easy steps:

  • Create an IG Trading Account or log in to your existing account
  • Enter ‘UBER’ in the search bar and select it
  • Choose your position size
  • Click on ‘buy’ or ‘sell’ in the deal ticket
  • Confirm the trade

The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.

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