The mega app's pivot to profit and its approach to the S&P 500 have shifted the outlook for this one-of-a-kind tech stock. This shift in gears may open up a timely opportunity for an Uber play.
Uber's latest earnings call generated some impressive numbers. With total revenue up 11 percent from a year earlier, the platform generated $221 million in net income.
In August, Uber revealed it generated positive cash flow for the first time ever. It brought in a hefty sum of $382 million, beating analysts' expectations by more than $100 million.
Buzz is building around Uber's admission to the S&P 500 – the most tracked index globally – as it nears officially reporting sufficient positive earnings to qualify to join the benchmark.
That is because, like so many tech companies, it has long prioritized expansion over profits and has reinvested its revenues in building its global ride-hailing and food-delivery empire.
If and when this happens, the so-called “S&P Phenomenon” could create significant price upswing. Many firms experience a short-lived price spike when they join the index driven by the sudden purchasing of their stock of the many funds that track the S&P.