Uber Heads Into Earnings With Shorts Retreating and Borrow Costs Rising

UBER enters its November 3 earnings report on the back foot, down 5% on the week to CAD 9.75, yet the market structure around the stock has shifted in a way that makes the setup more nuanced than the price action alone suggests.

Data note: The snapshot references a TSX listing in CAD, but Uber Technologies trades primarily on the NYSE in USD. The previous note cited a USD price of $68.94 last week. The CAD figure here likely reflects a cross-listed or dual-currency data feed. Positional and directional data is treated as consistent with the prior note; the price-level figures are flagged as potentially reflecting a different listing or currency.

The most notable shift this week is in short positioning, and the direction runs against the stock's weak price action. Shorts have been covering, not building. Short interest fell 17% in a single day on October 23 and is down 17% on the week to around 507,000 shares, roughly 0.02% of free float. That is a trivial structural short position by any measure, and the retreat confirms that the sellers are not the bears. The previous note noted SI at 2.4% of free float in USD-share terms; the difference in magnitude here almost certainly reflects the TSX cross-listing carrying a small fraction of the total float. The directional signal, shorts pulling back, is consistent across both datasets.

What has changed in the lending market is cost to borrow. The rate jumped to 3.56% on October 23, up from around 2.1% a week earlier and more than double where it sat a month ago. That 105% month-on-month rise in borrowing cost is the clearest technical tension in the snapshot: short interest is falling, but the cost of maintaining a borrow is rising. That combination typically reflects shorts who held positions through a squeeze or covering event paying a premium to stay in, rather than fresh conviction building on the short side.

The factor picture is mixed heading into the print. UBER ranks in the 85th percentile on EPS surprise, meaning it has a strong track record of beating estimates. EPS momentum is solid across both the 30-day and 90-day windows, at the 64th and 59th percentiles respectively. On the other side, valuation is a drag: the EV/EBIT factor ranks in just the 27th percentile, and earnings yield sits at the 35th. The ORTEX short score has drifted lower over the past two weeks, finishing at 28.8 on October 23 after touching 30.2 on October 13. A declining short score reflects easing short-side pressure, which aligns with the covering activity seen in the SI data.

On ownership, Capital Research and BlackRock each hold just over 7% of shares, with Vanguard close behind at 7.1%. All three added modestly to positions in the quarter ended September 30. Pershing Square, which built a 1.7% stake by end of June, has not updated its filing since. That cluster of large, patient institutional holders provides a degree of structural support, but none of the recent changes are large enough to read as a directional signal ahead of the print.

Uber's last two earnings releases produced a muted day-one move, down around 2% after the August report, and down 3% after the prior quarter. Both recovered strongly over the following five days, with the August print eventually generating a 4.5% five-day gain. That pattern, a small negative reaction fading into a recovery, is the base case the options market should be pricing around, though what matters most on November 3 is whether management can address the competitive pressure that has pushed the stock down nearly 5% this month while peers have broadly held ground.