Cramer warms up to Uber, says it's an OK time to start a position in the ride-hailing firm

CNBC’s Jim Cramer said Monday he’s warmed up to Uber, suggesting the investment case for the ride-hailing and food-delivery company now contains more positives than negatives.

“You’ve got my blessing to put on a small position in Uber; you can buy more into weakness if the stock pulls back if the Nasdaq also likes to test its low,” the “Mad Money” host said.

“Just remember, I expect the investor meeting a month from now to be a major positive catalyst,” added Cramer, referring to the event that’s scheduled for 11 a.m. ET on Feb. 10. It’s set to take place one day after Uber releases fourth quarter and full-year financial results.

Cramer acknowledged that Uber doesn’t necessarily fit within his main stock-picking theme for 2022, which is investing in companies that produce tangible goods and generate actual profits. However, he said he believes the unprofitable Uber’s “pivot to profitability is happening just in time” given likely interest rate hikes from the Federal Reserve.

“I’ve been telling you to avoid stocks that trade at multiples to sales, not earnings, but Uber now trades at just 3 times sales, and that is a real bargain if business keeps picking up,” said Cramer, who sees strong tailwinds for Uber’s ride-hailing business as people travel more and go out for entertainment after Covid-related slowdowns.

Uber Eats’ success during the pandemic also seems more sustainable, Cramer said, citing a reduction in competition in the app-based food-delivery market.

“Uber’s not a slam dunk. You’ve still got a regulatory risk and an omicron risk. If omicron lingers, that could put a damper on the ride-share recovery, but I think we’ve reached a point where the positives now outweigh the negatives,” Cramer said.

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