Uber Stock Flashes Bullish Signals After Nvidia Robotaxi Partnership News

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It came from Nvidia's  (NVDA)  GTC Conference late on Monday. Nvidia unveiled a new and expanded partnership with a number of automobile manufacturers (not the large U.S. companies) and with Uber Technologies  (UBER)  for its autonomous driving program. The Nvidia DRIVE Hyperion platform has now been adopted by traditional automaker Nissan (NSANY) as well as the likes of BYD BYD, Geely and Isuzu (remember them?).

BYD, Geely and Nissan are developing Level 4 autonomous programs built upon the DRIVE Hyperion compute, and sensor architecture. Isuzu and Tier IV are working together to build a Level 4 autonomous bus using Nvidia's DRIVE AGX Thor "system on a chip." Separately, Nvidia expanded an existing relationship with Hyundai Motor Group to work on and improve that company's autonomous driving platform for its Hyundai and Kia-branded vehicles.

For those not familiar with the "levels" of self-driving vehicles, Level 4 does not need human intervention whereas Level 3 vehicles must have a human ready to take over. Level 5 would permit the unmanned vehicle to operate anywhere a human could have gone, whereas Level 4 vehicles can only operate in virtually fenced areas.

As for Uber...

Uber plans to deploy a fleet of autonomous vehicles across 28 cities on four continents to be powered by Nvidia's DRIVE AV software. The rollout is not expected until early 2027. The initial cities for the program's U.S. launch will be Los Angeles and San Francisco. Uber CEO Dara Khosrowshahi commented, "Autonomous technology holds enormous promise to make transportation safer, more reliable and more accessible."

Uber is not expected to post first-quarter financial results until early May. Wall Street is looking for adjusted EPS of $0.72 on revenue of roughly $13.35 billion. That would compare less than well to the $0.83 reported for the year-ago period, on year-over-year sales growth of close to 16%. 

So far 15 sell-side analysts have reduced their estimates for the quarter since it began, while eight have revised their estimates higher. Of the 39 analysts I know of that track UBER, 16 have left their estimates unrevised to this point.

The Chart​

Readers will see that UBER has traded for the past half year or so, according to the stock's technical signals. The double top back in September and October foretold a nasty selloff. This was followed by a falling wedge that eventually led to a bullish reversal. 

At the bottom, in February, the stock developed a cup-with-handle pattern, which is bullish, with a $78 pivot. That pivot is aligned with the stock's 50-day simple moving average (SMA) and the shares are trying to take that level on Tuesday.

Taking pivot would unleash the technical traders while taking the 50-day SMA would force portfolio managers to increase long-side exposure giving such a move some potential for added muscle. 

Both Relative Strength and the daily moving average convergence divergence (MACD) are starting to set up bullishly as well. I would have no problem putting a $98 target price on UBER if I were long the shares.

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At the time of publication, Guilfoyle was long NVDA equity.