Uber Stock Tumbles as Morgan Stanley Slashes Price Target – Here’s Why

TLDR

• Uber stock dropped 5.6% after Morgan Stanley cut its price target from $115 to $110 while maintaining an Overweight rating
• The company discontinued monthly EV bonuses for drivers as part of scaling back climate initiatives
• Protests and regulatory pressure mounted in Europe, with 1,500 taxi drivers blocking Barcelona and similar pushback in the Cotswolds and Halifax
• Citizens maintained its Market Perform rating while flagging risks from Waymo and Tesla autonomous vehicle competition
• Uber is up 31.7% year-to-date but trading 16.9% below its 52-week high of $100.10

Uber shares took a hit on Wednesday, falling 5.6% as investors digested a price target reduction and news about changes to the company’s driver incentive programs. The stock closed at $83.18.

Uber Technologies, Inc., UBER

Morgan Stanley lowered its price target on Uber from $115 to $110. The firm kept its Overweight rating, suggesting it still sees upside potential. The cut came as one of several factors weighing on investor sentiment.

The company pulled back on its electric vehicle initiatives. Uber discontinued monthly bonuses for drivers using EVs. This move represents a scaling back of the company’s climate-related efforts.

Reports indicate the decision came as Uber faces mounting regulatory challenges in Europe. The timing suggests the company may be prioritizing cost management over environmental initiatives.

European Markets Push Back

Barcelona saw major protests against Uber on Tuesday. Around 1,500 taxi drivers blocked the city center. They’re supporting proposed legislation that could nearly eliminate ride-hailing services by drastically cutting available licenses.

The opposition isn’t limited to Spain. Licensed drivers in the Cotswolds demanded a ban on the Uber app. Officials in Halifax, Canada, are considering new regulations to level the playing field with traditional taxis.

This represents a coordinated pushback across multiple markets. Local taxi industries continue to pressure regulators to restrict Uber’s operations.

Competition Concerns Remain

Citizens reiterated its Market Perform rating on Uber. The firm highlighted potential headline risks despite solid performance in Mobility and Delivery segments.

The analysis pointed to three specific competitive threats. First, Waymo could develop general-purpose driving technology that doesn’t require high-definition maps. This would allow broader distribution to traditional automakers.

Second, a potential Waymo acquisition of Lyft could create a hybrid network. This combination would use autonomous vehicles more effectively and lower service costs.

Third, Tesla’s autonomous vehicle technology could converge with Waymo’s capabilities. This would create a competitor with scaled manufacturing and cost advantages over Uber’s human-driven network.

Citizens noted that Waymo’s current service isn’t positioned to capture major market share due to vehicle supply constraints. However, future technological developments could change this dynamic.

Uber has launched countermeasures. The company partnered with Avride to offer robotaxi service in Dallas. Riders can use autonomous vehicles in a 9-square-mile area at no extra cost.

The company also partnered with Starship Technologies. They’ll deploy autonomous sidewalk robots for food deliveries starting in Leeds, UK, in December 2025.

Despite Wednesday’s drop, Uber remains up 31.7% year-to-date. The stock trades 16.9% below its 52-week high of $100.10 from October 2025. S&P Global Ratings revised Uber’s outlook to positive from stable, citing 22% trip growth year-over-year in the third quarter of 2025.

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