Uber Technologies Inc. (UBER) on Thursday announced the acquisition of public transportation software provider Routematch, in a move to boost its public transit business.
The financial terms of the deal weren’t disclosed. The ride-hailing company said it is buying Routematch to support cities in offering more accessible public transportation. Atlanta-based Routematch provides technology to more than 500 transit agency partners in urban, suburban, and rural communities around the world.
“This acquisition brings together Uber’s expertise in on-demand, global mobility technologies with Routematch’s proven capabilities across paratransit, payments, fixed-route tools, and trip planning services,” said David Reich, Head of Uber Transit and Pepper Harward, CEO of Routematch in a joint statement.
Uber has in recent years been partnering with public transportation agencies around the world in an effort to build more efficient, accessible, and equitable public transportation networks. The acquisition comes after Uber last month closed its first software-based transit deal with an agency in the San Francisco Bay Area.
Shares in Uber dropped 1.4% to $32.34 in afternoon trading on Thursday, trimming this year’s advance to 8.7%. Looking ahead, the $41.89 average analyst price target implies shares have room to rise another 29% in the coming 12 months. (See Uber’s stock analysis on TipRanks).
Five-star analyst Jake Fuller at BTIG earlier this month maintained a Buy rating on the stock with a $47 price target but cautioned that consensus on the company’s financial performance is likely “aggressive”.
Fuller believes that the “ride hail recovery” is not bending up as work-from-home policies persist and work-related ride volume remains challenged noting that Uber’s “social” rides would have to top 2019 levels “by a lot” in the second half of 2020 to make consensus.
However, the analyst adds that Uber’s stock price suggests that the risk to estimates appears to be priced in.
The rest of the Street shares Fuller’s bullish rating outlook. The Strong Buy analyst consensus boasts 27 Buys versus 3 Holds.
Beyond Meat Shares Rise On Sale Of Plant-Based Meat In Brazil
Uber Snaps Up Postmates In $2.65B Stock Deal- Report
Beyond Meat Burgers Make Foray Into Alibaba’s Grocery Stores In China