BofA trims Uber target, but still says buy

Not exactly a downgrade, more like a haircut

Uber just got the classic Wall Street version of “you’re doing great, sweetie.” Bank of America cut its price target on the ride-hailing giant to $101 from $103, but kept a Buy rating in place. So yes, the target moved down — but the vote of confidence stayed.

The weirdly optimistic part

Here’s the part that matters for investors: BofA said it actually raised its earnings estimates after Uber’s second-quarter results. In other words, the bank likes the business a little more, but likes the stock a little less because the valuation multiple got squeezed. Translation: the fundamentals may be improving, but the price already did some of the heavy lifting.

Why your portfolio might care

Uber shares were trading around $71 Thursday afternoon, up about 4%, which means the market is still treating the stock like a momentum name with a long leash. When analysts keep the bullish rating but shave the target, it’s usually a sign that expectations have gotten richer — not that the story is broken.

Big picture

Uber’s post-earnings setup looks like the market’s favorite kind of dilemma: the company can be getting better while the stock gets harder to call cheap. That’s not a bad place to be, unless you’re the one trying to model where the next 10% comes from.