UBER is being irrationally undervalued due to autonomous driving concerns

I’ve been researching $UBER and believe the stock is significantly oversold due to excessive fear that autonomous vehicles will soon destroy the ride-hailing business. This mirrors the situation with $GOOG earlier this year, when panic over ChatGPT and generative AI led to a sharp sell-off on concerns that search market share would vanish overnight. In reality, Google integrated AI into its products, preserved its moat, and the stock recovered as the threat proved premature.

A similar dynamic is at play with Uber. The prevailing narrative assumes robotaxis will scale rapidly and obsolete human drivers, collapsing Uber’s commission model. However, widespread autonomous adoption faces major regulatory, safety, and cost barriers, making meaningful disruption likely 5–10 years away. Uber’s powerful network effects remain intact in the meantime, and the company is proactively partnering with AV leaders like Waymo while positioning its app as the primary interface for both human and autonomous rides.

A major risk for all rideshare companies is lack of customer loyalty. The vast majority of ride share users have multiple apps and will use the option that meets the right mix of affordability and convenience at that given moment. I see this as a major advantage to Uber since they are the most widespread and have the most robust infrastructure to be able to provide the most low cost and convenient option. I recently traveled to multiple countries in South America and Uber was everywhere and cheaper than all alternatives.

Additional growth drivers include continued expansion in Uber Eats with improving margins, scaling advertising and freight segments, and sustained profitability progress. At current valuations, the growth runway appears attractive if AV timelines extend even modestly.

I’m long $UBER and adding on dips. Open to counterpoints on AV adoption speed or other risks.