Uber Technologies Plummets 2.88%: Can This Sell-Off Be a Buying Opportunity?

Summary
• Uber Technologies (UBER) trades at $85.07, down 2.88% from its previous close of $87.59
• Intraday range spans $84.96 to $87.27, with 9.87 million shares traded
• Analysts remain split: 35 'Strong Buy' vs. 1 'Strong Sell' ratings
• Melius Research’s $73 price target and robotaxi optimism create conflicting narratives

Uber Technologies is experiencing a sharp intraday selloff amid mixed analyst sentiment and strategic developments. The stock’s 2.88% decline has sparked debate between bulls eyeing long-term AI-driven growth and bears warning of overvaluation. With a 52-week high of $101.99 and a dynamic P/E of 13.58, the stock’s trajectory hinges on balancing near-term volatility with transformative partnerships in autonomous vehicles.

Melius Downgrade and Sector Volatility Fuel Short-Term Selloff
Uber’s intraday decline is driven by Melius Research’s 'Sell' downgrade to $73 and broader sector jitters. While Jefferies and BofA maintain 'Buy' ratings with $120–$119 price targets, the Melius bear case highlights competitive risks and valuation concerns. This selloff coincides with renewed focus on Uber’s robotaxi partnerships with Lucid and Nuro, which analysts view as margin-friendly but speculative. The stock’s 52-week low of $60.63 and 34.9% annual return contrast with its current 2.88% drop, reflecting short-term profit-taking amid uncertainty over execution risks in autonomous vehicle deployment.

Ridesharing Sector Volatile as LYFT Trails UBER’s Slide
The ridesharing sector remains under pressure, with sector leader Lyft (LYFT) down 1.59% intraday. Both UBER and LYFT face margin compression from rising operational costs and regulatory scrutiny. However, Uber’s robotaxi advancements and $112.30 average analyst price target suggest stronger long-term catalysts compared to LYFT’s reliance on traditional ride-hailing. The sector’s 33.83x average P/E versus Uber’s 10.94x P/E highlights Uber’s undervaluation, though LYFT’s 1.59% decline underscores shared macroeconomic headwinds.

Options Playbook: Capitalizing on Volatility with UBER20260116C86 and UBER20260116C87
• 200-day average: $88.23 (above current price)
• RSI: 78.45 (overbought)
• MACD: -0.64 (bearish divergence)
• Bollinger Bands: Price at $85.07 (near lower band at $77.58)
• Roundhill UBER WeeklyPay ETF (UBEW): -3.59% intraday

Uber’s technicals suggest a short-term correction after a 34.9% annual rally. Key support at $81.02 and resistance at $91.58 define a tight trading range. The Roundhill UBER WeeklyPay ETF’s -3.59% drop mirrors UBER’s volatility, making it a leveraged play for directional bets. For options, UBER20260116C86 and UBER20260116C87 offer compelling risk/reward profiles:

• UBER20260116C86
- Code: UBER20260116C86
- Type: Call
- Strike: $86
- Expiration: 2026-01-16
- IV: 28.94% (moderate)
- LVR: 81.72% (high leverage)
- Delta: 0.4074 (moderate sensitivity)
- Theta: -0.2642 (high time decay)
- Gamma: 0.1066 (high sensitivity to price movement)
- Turnover: 220,040 (liquid)
- Payoff at 5% downside (80.82): $0.00 (strike above current price)
- Why it stands out: High gamma and theta make it ideal for short-term directional bets if the stock rebounds from support.

• UBER20260116C87
- Code: UBER20260116C87
- Type: Call
- Strike: $87
- Expiration: 2026-01-16
- IV: 30.07% (moderate)
- LVR: 113.31% (high leverage)
- Delta: 0.3144 (moderate sensitivity)
- Theta: -0.2199 (high time decay)
- Gamma: 0.0938 (high sensitivity to price movement)
- Turnover: 133,639 (liquid)
- Payoff at 5% downside (80.82): $0.00 (strike above current price)
- Why it stands out: Strong gamma and moderate delta position it to capitalize on a rebound above $87.50, aligning with the 200-day average.

Aggressive bulls should consider UBER20260116C86 into a bounce above $86.50.

Backtest Uber Technologies Stock Performance
The backtest of Uber's (UBER) performance after a -3% intraday plunge from 2022 to the present reveals positive short-to-medium-term gains. The 3-Day win rate is 50.92%, the 10-Day win rate is also 50.92%, and the 30-Day win rate is 59.47%, indicating a higher probability of positive returns in the immediate aftermath of such events. The maximum return during the backtest period was 7.81%, which occurred on day 59, suggesting that while there is some volatility, Uber can exhibit strong recovery in the weeks following a significant intraday drop.

Uber at a Crossroads: Buy the Dip or Sidestep the Dip?
Uber’s 2.88% selloff creates a critical inflection point for investors. While the stock’s 54.6% DCF discount and 10.94x P/E suggest undervaluation, near-term risks include Melius’s bearish thesis and sector volatility. Key levels to watch: $81.02 (30D support) and $91.58 (200D resistance). Sector leader LYFT’s -1.59% decline underscores shared macro pressures. For those with a 3–6 month horizon, UBER20260116C86 and UBER20260116C87 offer high-leverage plays on a rebound. Watch for a break above $87.50 or a breakdown below $84.96 to confirm direction.