Tesla Inc. (NASDAQ: TSLA), has risen by about 40% in the last month, on hope that Donald Trump would ease US rules for self-driving cars when he is sworn into his office.
Bloomberg reported that he intends to make regulation of autonomous cars a priority at the Department of Transportation.
Tesla, however, isn’t the only company that could benefit from a policy shift of this magnitude.
Mark Mahaney, Evercore ISI’s director of internet research, says Uber Technologies Inc. (NYSE: UBER) could be another name to benefit from Trump’s position on autonomous vehicles.
What is the impact of self-driving on Uber’s stock price?
Tesla’s autonomous vehicle promises will be met with a boost from the Trump administration’s increased focus on self-driving technologies.
Mark Mahaney believes that Elon Musk is not the only company likely to dominate the market for AVs. Uber will be the ultimate demand-aggregator, he believes.
In a recent CNBC interview, he said: “Uber will be a positive long-term derivative of this.”
Mahaney names Uber as his number one large-cap stock pick. He sees it rising to $120, which would indicate a potential 65% increase from this point.
Uber Technologies under investigation
According to reports, the ride hailing giant has been under investigation for allegedly violating US consumer protection laws with its subscription service.
The Federal Trade Commission will investigate whether Uber One enrolled customers without their consent, and made it difficult for them to cancel the service.
Uber’s financial strength makes it a stock worth buying.
In its last reported quarter, the multinational exceeded Street expectations as its monthly active users on its platform increased 13% from year to year.
Uber Technologies also guided at that time for adjusted EBITDA of $1.78 to $1.88 Billion for the current quarter – which was in line with expectations. Uber’s shares have fallen about 17% from their recent high as of this writing.
Uber’s concerns have been exaggerated
Uber’s stock price has suffered in recent weeks due to a slight slowdown in bookings for mobility services in the recently completed quarter.
Mahaney is still bullish about the Uber Technologies name, despite concerns that robotaxis will be a problem for Uber Technologies and that bookings in the mobility sector are likely to continue declining.
Uber will need to sign more agreements like those it has already made with Waymo in order to be deemed a “winner” of the robotaxis.
Mahaney said that product innovations and easier comparisons will allow the company to stabilize growth rates in the coming year.
Uber shares, on the other hand, do not pay out a written dividend.
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