A Bank of Americas survey found that Uber’s wait time and prices are well below the 2Q21 level (at the time when Uber suffered severe driver shortages, and had invested heavily in driver supply).

The average price per mile for four Tier 1 markets across this weekend, including the $0.45 – $0.55 gas tax, was $4.22. It is in line with 4Q21. It is slightly higher than January-Feb prices (at $3.54), since the average cost per mile in Tier 1 markets over this past weekend was $4.22. (Pricing has increased in March but still remains at historical levels). The average price per mile across a wider range of Ubers and Lyfts in 10 US cities is $4.58. In a client note, Justin Post, analyst wrote that today’s price per mile was 7 percent higher than 4Q21 ($4.58 today vs. 4.29 October 2021).

Also, the average wait time for Uber rides in Tier 1 markets is much lower than 2Q21 peak levels at 4.1 minutes (vs 5.7 minutes 2Q21). According to BofA analysts, it is still 3.6 minutes longer than Jan-Feb.

Post, Net-net and Post remain positive on Uber. An analyst targets a price of $55.00 per Uber share.

Despite driver supply issues increasing due to gas price rises, wait times in our data are better than 2021. Driver supply risks may increase in the 1Q/2Q. There could be take rate pressure should Uber decide to pay more for gas, as it is necessary to maintain driver availability. Post wrote in a client letter that we had observed an improvement in mobility in Urban areas during March. We believe the price of gas could rise in industry.

Uber shares traded nearly 6 percent higher pre-open, after Uber reached an agreement to list all New York taxis in its app.

By Senad Karaahmetovic