Uber plummets after earnings, and one technician says he’d ‘rather walk’ than buy the stock
Uber hit the skids after the bell Thursday.
The ride-hailing company reported a quarterly loss of more than $5 billion, its
The company follows on the heels of competitor Lyft, which reported a smaller than expected quarterly loss Wednesday afternoon. That sent shares of Lyft stepping on the gas and rallying 4 percent today. Shares of Uber also surged on optimism surrounding Lyft, soaring 7 percent during Thursday’s session.
But Piper Jaffray technician Craig Johnson said Thursday on CNBC’s “Trading Nation” that he’d “rather walk than ride” both Uber and Lyft.
“Specifically, when you look at the chart of Lyft, it looks to us that this is a bearish rising wedge and we just broke below the kind of pinnacle of that,” he explained. It looks like just a relief rally to us at this point in time, so we’d be a seller of the stock.”
The charts also pointed to trouble for Uber ahead of their report after the bell, said the technician.
“We need to see a close on Uber above about $44 to really reverse the downtrend here,” he added. “So that’s what I’m going to be looking for in any sort of earnings announcement with Uber here.”
Nancy Tengler, chief investment strategist of Tengler Wealth Management, echoed Johnson’s sentiments, especially given that she didn’t believe there was “any foreseeable future of earnings” for Uber.
“Growth at any cost is not necessarily what equity investors are looking for,” she said on “Trading Nation.” “So I’m on the sidelines, it would take a lot to get me in.”
Tengler also emphasized that Uber’s global exposure could also make it prone to markets that are experiencing slower growth.
Since its IPO in early May, shares of Uber have fallen 5 percent.