Uber stock drops over 5% as Waymo’s partnership with Lyft fuels investor concerns

Uber stock: Uber Technologies stock dropped more than 5% on Wednesday after Alphabet-backed autonomous cab provider Waymo partnered with the firm's rival Lyft to enter Nashville next year. While Waymo has partnerships with Uber to get its robotaxis into Atlanta and Austin, Texas, as per a report.

Waymo Teams Up with Lyft, Challenging Uber’s Dominance

While Lyft stock rose more than 12% after the announcement, both Uber stock and Lyft stock have been under pressure over the past 12 months by the growth of Waymo, and Tesla's robotaxi plans, as investors fear that robotaxi firms like Waymo could upend the market for hailing rides through apps, as per an IBD report.

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Uber’s Autonomous Vehicle Strategy Faces Competition from Lyft and Waymo Deal

The Waymo and Lyft deal might reignite concerns about the relationship between Uber and Waymo as it is a key partner in Uber's broader strategy of bringing a wide range of autonomous offerings onto its platform, as reported by IBD. Even last year, Uber stock dropped sharply after Waymo announced its plan to expand to Miami and did not name Uber as a partner, according to the report.

Wedbush analyst Scott Devitt wrote in a client note on Wednesday that the deal shows that Lyft is stealing "Uber's thunder", as per the IBD report. However, Devitt has a neutral rating on both Lyft stock and Uber stock and said he expects robotaxis to take market share from both companies, according to the report.

He said that, "While we think the near-term financial impact to established ridesharing platforms is limited, over time, we expect AVs will disrupt the current status quo," as quoted by IBD.

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Uber CEO Sells $28 Million in Shares

Meanwhile, Uber CEO Dara Khosrowshahi sold 300,000 shares of the company's stock in a transaction last Friday, with shares sold at an average price of $95.37, for a total transaction of $28,611,000.00, as per a Market Beat report.

After the completion of the sale, the chief executive officer directly owned 1,132,544 shares of the company's stock, valued at approximately $108,010,721.28, which represents a 20.94% decrease in Khosrowshahi's position, as per the Market Beat report.

Uber’s Market Cap

Uber has a market capitalization of $196.06 billion, a P/E ratio of 15.99, and the stock's 50-day moving average price is $92.67, and its 200-day moving average price is $84.96, as per the Market Beat report.

FAQs

Why did Uber’s stock drop?
Waymo teaming up with Lyft in Nashville sparked worries investors might favor Lyft, causing Uber’s stock to fall.

How did Lyft’s stock react to the Waymo deal?
Lyft’s stock jumped more than 12% after the news, showing investor optimism about the new robotaxi partnership.