Uber(US:UBER) The Motley Fool·2025-11-27 12:30Core Insights - Bill Ackman's Pershing Square Capital Management has taken a significant stake in Uber Technologies, viewing it as a "free cash flow machine" with substantial earnings growth potential [1][4][5] Company Overview - Pershing Square typically holds 10 to 12 stocks, allowing for in-depth research on each investment [2] - Ackman has praised Uber's CEO for transforming the company into a profitable and cash-generative entity, highlighting its capital-light nature and ability to generate excess cash flows [5] Financial Performance - Uber generated nearly $7 billion in free cash flow in the first three quarters of the year, representing a 34% increase from the previous year [5] - In Q3 2025, Uber's gross bookings grew by 21%, with Uber Eats experiencing a 25% growth [6] Shareholder Value - Ackman anticipates that Uber will repurchase 4% of its market cap this year, which is expected to enhance earnings per share [7] Future Prospects - Investors are expected to focus on Uber's advancements in the autonomous driving sector, with partnerships established with companies like Waymo and Lucid Group [8] - Nvidia's partnership with Uber aims to scale its autonomous vehicle fleet to 100,000 vehicles, indicating a significant AI component to Uber's future [9] Earnings Growth Potential - Ackman and his team project that Uber can achieve over 30% earnings per share growth in the medium term, which could lead to a higher valuation multiple [10][11] - Current market expectations suggest Uber will earn $3.60 per share in 2026, trading at approximately 23 times forward earnings [10]