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ravedeath
Posted: 07 February 2025 18:53:14(UTC)
#626

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Bill commented on a less rewarding Uber experience last year...


https://x.com/BillAckman...ber-ceo-ceo-said-this%2F
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Raj K on 08/02/2025(UTC)
Johan De Silva
Posted: 07 February 2025 20:47:16(UTC)
#628

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CNN: Pershing Square's Bill Ackman revealed Friday that he has built a significant stake in Uber, saying the stock is still trading at a "massive" discount.

In a post on X, the hedge fund manager said his fund began buying Uber shares in early January and has amassed 30.3 million shares, worth $2.3 billion based on the stock's current level around $75 per share
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Auric on 07/02/2025(UTC), Newbie on 08/02/2025(UTC), Raj K on 08/02/2025(UTC)
Newbie
Posted: 08 February 2025 00:52:58(UTC)
#624

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Rookie Investor;333597 wrote:
Raj K;333596 wrote:
Johan De Silva;333594 wrote:
Bill Ackman’s Pershing Square Builds a $2.3 Billion Stake in Uber
https://www.wsj.com/live...er-MTRbvUTAJRlBq03MrzEH

Impeccable timing as Uber is one of the best performers +10 percent
https://www.google.com/finance/quote/UBER:NYSE

Uber has a P/E of 33 but I presume Ackman is attracted to the cash flows.


Blimey wondering if he sold another position to fund this. Noting on Dataroma yet. Tuseday's annual investor presentation will be interesting!



Was thinking the same, the position size seems huge given the fund. Maybe he sold some google?

Funnily enough I was thinking of buying Uber when it dipped two days ago after the earnings but did not have the guts! Oh well. I guess I now own it via PSH.

I am not so sure about Uber. It has huge upside IF AV comes about and it becomes an aggregator for all the AV vehicles, so work in collaboration with the AV suppliers like Waymo and Tesla.

But on the other it seems like an app that one can easily just move to another app with no cost, and so not sure what the moat is - when AV becomes mainstream then people can just use the Waymo app or Tesla app etc so Uber becomes cut off from business. Valuation does not look cheap either.

Uber IMO is still cheap and there is a lot of upside left.

Despite the 15% rally in the last two days the price is about par with circa 1 year ago (hence why it is still value).

Even with self driving on the horizon Uber in most likely cases is likely to be a winner. Whilst all the hype is around FSD and Tesla, what people may be overlooking is is that the Capex involved in
(a)manufacturing those vehicles
(b) storing those vehicles
(c) managing the fleet, servicing the vehicles, taxing them etc
(d)Then you will have to look at competition entering and lowering price (squeezing margins)
(e) getting all the regulations and approvals through in different juristictions
(f) having the infrastructure set up to manage end to end commerciability
(g) Human buy in (acceptance) to take trips via FSD

That plus much more is some distance away - a good couple of years.

So in many cases and most scenarios the optimum strategy would be to partner with Uber (in the initial days anyway) not only to get customers but also a route to market (Tesla only has access to it is owners for now). The manufactures also have will have to choose if the want to enter the taxi business or stick to making cars (and no, Tesla is not a car company - it is a software company with a manufacturing division so may end up being the only competition for Uber).

Uber have little to no Capex need, no fleet, all approved, contracts in place etc - Hence compelling investment with recurring income.

Whilst Waymo is gathering momentum, it does 150 thousand trips a week - Uber does 3m a day !

My Tuppence

BTW I did by two days ago both Uber and 3xUber (see transactions thread) - the latter is up 33% today and 15% yesterday.

In terms of Ackman exit - I would not be surprised if it is Nike.

For me both Amazon and Google have delivered good results and the stock is down making them better value especially as, the reason for the sell off seems to be primarily driven by the large Capex spend announcement. However both companies have stated that they cannot meet current demand (let alone future) and thus greater capex is needed. He got badly burned with Netflix (similar model to the likes of Uber, Amazon, Google etc) and I doubt he wants to make that same mistake.
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Rookie Investor on 08/02/2025(UTC), Raj K on 08/02/2025(UTC)
Rookie Investor
Posted: 08 February 2025 01:54:07(UTC)
#625

Joined: 09/12/2020(UTC)
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Newbie;333620 wrote:
Rookie Investor;333597 wrote:
Raj K;333596 wrote:
Johan De Silva;333594 wrote:
Bill Ackman’s Pershing Square Builds a $2.3 Billion Stake in Uber
https://www.wsj.com/live...er-MTRbvUTAJRlBq03MrzEH

Impeccable timing as Uber is one of the best performers +10 percent
https://www.google.com/finance/quote/UBER:NYSE

Uber has a P/E of 33 but I presume Ackman is attracted to the cash flows.


Blimey wondering if he sold another position to fund this. Noting on Dataroma yet. Tuseday's annual investor presentation will be interesting!



Was thinking the same, the position size seems huge given the fund. Maybe he sold some google?

Funnily enough I was thinking of buying Uber when it dipped two days ago after the earnings but did not have the guts! Oh well. I guess I now own it via PSH.

I am not so sure about Uber. It has huge upside IF AV comes about and it becomes an aggregator for all the AV vehicles, so work in collaboration with the AV suppliers like Waymo and Tesla.

But on the other it seems like an app that one can easily just move to another app with no cost, and so not sure what the moat is - when AV becomes mainstream then people can just use the Waymo app or Tesla app etc so Uber becomes cut off from business. Valuation does not look cheap either.

Uber IMO is still cheap and there is a lot of upside left.

Despite the 15% rally in the last two days the price is about par with circa 1 year ago (hence why it is still value).

Even with self driving on the horizon Uber in most likely cases is likely to be a winner. Whilst all the hype is around FSD and Tesla, what people may be overlooking is is that the Capex involved in
(a)manufacturing those vehicles
(b) storing those vehicles
(c) managing the fleet, servicing the vehicles, taxing them etc
(d)Then you will have to look at competition entering and lowering price (squeezing margins)
(e) getting all the regulations and approvals through in different juristictions
(f) having the infrastructure set up to manage end to end commerciability
(g) Human buy in (acceptance) to take trips via FSD

That plus much more is some distance away - a good couple of years.

So in many cases and most scenarios the optimum strategy would be to partner with Uber (in the initial days anyway) not only to get customers but also a route to market (Tesla only has access to it is owners for now). The manufactures also have will have to choose if the want to enter the taxi business or stick to making cars (and no, Tesla is not a car company - it is a software company with a manufacturing division so may end up being the only competition for Uber).

Uber have little to no Capex need, no fleet, all approved, contracts in place etc - Hence compelling investment with recurring income.

Whilst Waymo is gathering momentum, it does 150 thousand trips a week - Uber does 3m a day !

My Tuppence

BTW I did by two days ago both Uber and 3xUber (see transactions thread) - the latter is up 33% today and 15% yesterday.

In terms of Ackman exit - I would not be surprised if it is Nike.

For me both Amazon and Google have delivered good results and the stock is down making them better value especially as, the reason for the sell off seems to be primarily driven by the large Capex spend announcement. However both companies have stated that they cannot meet current demand (let alone future) and thus greater capex is needed. He got badly burned with Netflix (similar model to the likes of Uber, Amazon, Google etc) and I doubt he wants to make that same mistake.


I'm struggling to see what is so special about Uber in terms of its moat? The app does not seem too complicated to replicate, it just connects the driver to the passenger, based on location and requirements such as time, size of car etc.

Meanwhile, Waymo, Tesla etc are driving AVs gathering huge amounts of data to fine tune their AV vehicles so they get ever closer to wide spread AV usages.

There shouldn't be anything stopping Waymo (for e.g.) from developing their own Waymo app that has the same functionality as Uber does. Cut out the middle man, keep the margins, which helps sustain their business model in a capex intense business.

I do note that Waymo has partnered with Uber, but not sure of the specifics of that.

IF you have a handful of players in supplying the AV cars, then they can just have their own app. But have many car manufacturers in the market, then I can see potentially where Uber fits in - because users need an aggregator like an Expedia for holidays or Zoopla for property.

It might be worth a punt for the later scenario, as moving from a small proportion of all rides to potentially a massive share in all rides once AV comes, should see huge upside.

Actually now you got me thinking...
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Newbie on 08/02/2025(UTC)
Johan De Silva
Posted: 08 February 2025 08:43:07(UTC)
#630

Joined: 22/07/2019(UTC)
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This forum has never liked most of PSH buys.

Combine this view with an very impressive performance. I suppose this is why we should hold a meaningful allocation to PSH.

I watched so many active Investment Trust managers and they are all a joke doing the same index hugging underperformance strategy that can only deliver access returns if by chance their style is in luck. They are not flexible to change and too constrained. We ned more like PSH as eventually a Netflix happens.... I think JAVA comes close.
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Sheerman on 08/02/2025(UTC), what me worry? on 08/02/2025(UTC)
Big boy
Posted: 08 February 2025 11:22:13(UTC)
#631

Joined: 20/01/2015(UTC)
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Johan De Silva;333625 wrote:
This forum has never liked most of PSH buys.

Combine this view with an very impressive performance. I suppose this is why we should hold a meaningful allocation to PSH.

I watched so many active Investment Trust managers and they are all a joke doing the same index hugging underperformance strategy that can only deliver access returns if by chance their style is in luck. They are not flexible to change and too constrained. We ned more like PSH as eventually a Netflix happens.... I think JAVA comes close.


Sadly I agree 100% about the Investment/Fund Management Industry. Totally constrained and this is why I have attempted to encourage Members down a different path. Having been a Director of many of these Companies I understand why they have to manage their own risk before many of their clients/customers.

I have found with PSH you go overweight about 35% discount and underweight say mid twenties discount.

Clearly this Trust will continue to trade at discount as most shareholders have no power to make M&A changes.
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what me worry? on 08/02/2025(UTC), Johan De Silva on 08/02/2025(UTC)
Rookie Investor
Posted: 08 February 2025 11:33:25(UTC)
#632

Joined: 09/12/2020(UTC)
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Big boy;333635 wrote:
Johan De Silva;333625 wrote:
This forum has never liked most of PSH buys.

Combine this view with an very impressive performance. I suppose this is why we should hold a meaningful allocation to PSH.

I watched so many active Investment Trust managers and they are all a joke doing the same index hugging underperformance strategy that can only deliver access returns if by chance their style is in luck. They are not flexible to change and too constrained. We ned more like PSH as eventually a Netflix happens.... I think JAVA comes close.


Sadly I agree 100% about the Investment/Fund Management Industry. Totally constrained and this is why I have attempted to encourage Members down a different path. Having been a Director of many of these Companies I understand why they have to manage their own risk before many of their clients/customers.

I have found with PSH you go overweight about 35% discount and underweight say mid twenties discount.

Clearly this Trust will continue to trade at discount as most shareholders have no power to make M&A changes.





I've learnt over the many years I have been investing that buy ad holding good companies or funds, without selling, taking a long term views has worked really well for me. Over 70% of my portfolio I have held and not touched for 5 years at least, much of that for close to 10 years.

Easy to say in a bull market, sure. But seems a lot less stressful/time consuming/costly than buying/selling via trading activity!
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Jay P on 08/02/2025(UTC), Shero on 08/02/2025(UTC)
Newbie
Posted: 08 February 2025 12:19:11(UTC)
#629

Joined: 31/01/2012(UTC)
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Johan De Silva;333612 wrote:
CNN: Pershing Square's Bill Ackman revealed Friday that he has built a significant stake in Uber, saying the stock is still trading at a "massive" discount.

In a post on X, the hedge fund manager said his fund began buying Uber shares in early January and has amassed 30.3 million shares, worth $2.3 billion based on the stock's current level around $75 per share

I looked at JAVA and was finding it difficult to find a place for it especially when you have the liked of JAM, PSH, JURE (and JGRE). PSH obviously has the discount, JAM rarely does but has a 80/20 large/small cap mix.

It is no doubt a good etf but trying to fit it in is a bit of an issue. Nevrtherless it is on the sidelines for now.
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Rookie Investor
Posted: 08 February 2025 12:35:06(UTC)
#633

Joined: 09/12/2020(UTC)
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To be fair, it seems like Uber's moat is in the brand. It is a brand,. much like Google, in that one automatically thinks of Uber fi one wants a taxi. Likewise to search online for something, people just "google it".

Uber FCF yield is around 5% so actually not that expensive. But it is low margin and growth is ok.
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Rookie Investor
Posted: 08 February 2025 16:28:08(UTC)
#634

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Some more thoughts on Uber:

2024 results look good in terms of growth; revenue growth was close to 20%.

However, on a PE measure, excluding the one-off tax refund and gains on investments, it is over 50x. Seems excessive I think.

FCF yield is 4%, but that excludes SBC, which is not insignificant and insurance reserves, also not insignificant. The yield is misleading by itself.

For a 50x PE stock I would expect 20% growth at least for a business that has been around a while now, perhaps more if operating under low margins. Not much room for error. Particularly when it comes to insurance, dilution etc. But they have a lot of operating leverage, given they have no variable costs as such. Does not take a lot of revenue to boost operating income.

If there is rapid growth under current model (uber, uber eats), perhaps more remote locations and/or EM countries, then this could be a long term play. But execution risk in new markets is always there, and perhaps costly.

Longer term play on AV will depend on how it develops and the end scenario assumed. Waymo and Tesla the leaders, developing the tech. The former does not have to spend capex on a AV fleet and so can licence the tech. So who owns the fleet? If the market becomes one with many companies owning the fleet, perhaps paying a licence to Waymo for the tech, then it suggests an aggregator is needed, and Uber is well positioned.

Google AV seems ahead due to miles ridden. I think they will end up licencing the tech and earn $$$. Perhaps Ackman sees this as owning Google and now Uber. He probably sees a many fleet owning market which means Uber becomes the one and only aggregator.

Think it is a good play long term, if you believe in many AV fleet, which makes more sense to be than a mono/duopoly.

Raj/Newbie - thoughts?
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