among the top holdings in its mutual fund. "When you can buy a business at a similar market cap that's currently producing cash flow with much more certainty of outcome, why not take that instead?"Yacktman sees the value in Uber as a service. He knows it saves time, makes payments easy and provides a much more comfortable ride than your typical cab. Food delivery also makes perfect sense, given there's a huge fleet of cars on the streets.
Uber has a metric called core platform contribution margin, which is the percentage of revenue left after "direct expenses." That number came in at 9% of revenue for 2018, and that's before accounting for all the investments in emerging products. In the first quarter of 2019, the number is turning south, with Uber expecting a negative margin of between 4% and 7% because of competition and spending on Uber Eats, the food delivery business.
"I'd rather buy one of the host of profitable companies showing me the money now and take a wait-and-see approach with Uber to determine if this is a sustainable profitable business model," said Yacktman. Large-cap companies that are losing money today are being punished by the market. CVS shares have plunged 22% in the past year, while GE has lost 31%.Uber has a very different story to tell than those two companies, which are stuck in legacy markets and struggling to find opportunities for growth. Only a decade old, Uber is pioneering a new industry and working towards a future of self-driving cars, all while growing 42% last year to over $11 billion in revenue.
Uber's vision is to build global platform that includes ride-sharing in its current form, a continued expansion of Uber Eats and with a whole lot more.
Not necessarily an ugly group.
Capitalism has failed
Sooooo if its not profitable, HOF is it worth 50 billion? They don't own any real-estate and it's just an App? this is why venture capital always wins, worst-case senerio sell it to the public. We should never let a no profit go public. But CNBC will do their best to sell it!
lol
Uber will die out as a direct result of Tesla Robotaxis. Cheap and safer transport, why ride in a vehicle with a stranger when you dont have too? Is it 2020 yet?
Ugly is right
bjmquinn Relatedly
Melamamaron 😱
Uber makes the same or more on rides than the driver's 🚖
Next, UberLyft
How the hell are they losing money?
Trump’s stock market will shortly come tumbling down...
That this can even be considered an actual thing says something pretty sad about our society.
Change the tax code if this bothers u
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