Uber is set to join the S&P 500 index later this month, indicating a positive turnaround for the ride-hailing and delivery company after a challenging period during the pandemic. The addition to the benchmark index is expected to boost the stock as it will attract more demand from funds designed to mirror the S&P 500 holdings. Uber's shares have already seen a significant increase this year, reaching a new high of $60.31 per share, compared to $20.46 per share in the summer of 2022.
The pandemic had a severe impact on Uber's ride-hailing business due to government lockdowns and the work-from-home trend, which limited the need for transportation services. However, the company responded by focusing on its food-delivery division, which has become a major revenue driver. This shift in strategy has proven successful, with Uber's ride-hailing service gradually recovering and now handling more rides than in 2019.
The inclusion in the S&P 500 index is seen as a positive sign for Uber's future prospects. Being part of this widely tracked index will attract more investors and potentially drive up the stock price. This development aligns with Uber's long-term goal of achieving consistent profitability.
It's worth noting that Uber's CEO, Dara Khosrowshahi, has been leading the company through these challenging times. His leadership and strategic decisions have contributed to the company's ability to navigate the pandemic and focus on areas of growth.
Overall, Uber's addition to the S&P 500 index reflects its successful efforts to adapt to changing market conditions and diversify its services. This move is expected to further strengthen the company's position in the ride-hailing and delivery industry, and investors seem optimistic about its future prospects.