This sluggish stock might have the legs to surge by over 15% in 2024

Trading.biz analyst Rahul Nambiampurath has identified a key Software and Services player that, despite a beaten-down EPS declaration for Q1 2024, could still move up 15% to 20% in 2024.

Already down by 6% week-on-week, the stock pick is none other than Uber Technologies Inc (UBER).

Despite a sluggish May 2024, the company has managed to rake in gains to the tune of 28.24% over the past six months.

“Even though Uber underperformed financially in Q1 2024, its operational presence across multiple segments like ride-sharing, freight, and food delivery make it a desirable player,” mentions Rahul.

He added that Uber also steadily integrates Artificial Intelligence into the scheme of things, especially for route and delivery optimization. This move might improve market penetration in months to come.

Uber’s Q1 2024 report and the road ahead

Rahul analyzed the entire Q1 2024 report and noted down the following insights:

• Earnings-Per-Share value of -$0.32, against the market expectation of $0.21.
• The year-on-year revenue increased by 14.8%, which was one of the highlights, restricting the price correction.
• Uber forecasts a steady revenue growth for Q2 2024, with an EPS estimate of $0.26.

The key financial findings reveal that despite Q1’s underwhelming metrics, the broader market believes Uber Technologies will outperform.

What do the technical figures say?

Rahul predicted a correction at UBER’s counter a few weeks back, courtesy of the ascending channel formation. However, the latest dip has changed the pattern, shifting things to a more unpredictable triangle/pennant formation.

UBER’s past performance as highlighted by Rahul: TradingView

UBER is currently trading at $66.99, and a move above the red line or the 50-day EMA line or $72 could push the prices towards the upper trendline of the pennant. Once this level is breached, UBER might not face much bearish resistance up until $82.44, one of the key resistance levels.

UBER’s daily chart: TradingView

But the Relative Strength Index indicator should cross 64 for this aggressive move to hold. A dip below the lower trendline could invalidate the bullish optimism.

James Lee, an analyst at Mizuho Securities, maintains a “Buy” rating for UBER, with a price target of $90 — a level in sync with Rahul’s analysis.