SERV Partners With Wing to Boost Delivery: Should You Buy the Stock?
Serve Robotics SERV recently announced a partnership with Wing Aviation LLC, a drone delivery provider, to enhance its autonomous delivery capabilities and expand its market reach.
This collaboration enables autonomous delivery that delivers millions of small packages daily around the world. It delivers all packages within a 6-mile area very quickly and also helps merchants adapt drone delivery without any modification to their facilities.
Through this partnership, SERV can provide a fast, cost-efficient and eco-friendly service that is safe and convenient for merchants.
Will SERV’s Strong Partner Base Boost Prospects?
Serve Robotics’ shares have surged 151.6% compared with the Zacks Computer & Technology sector’s growth of 40.7% and its Zacks IT Services industry’s return of 27.8% year to date.
Serve Robotics Inc. Price and Consensus
Serve Robotics Inc. price-consensus-chart | Serve Robotics Inc. Quote
Serve Robotics is gaining from its expanding robotics offerings and strong partner base, which improve its market position by giving strong competition to its peers, such as Kiwibot, Starship Technologies and Coco.
In the second quarter of 2024, SERV generated revenues of $0.47 million, significantly better than the $0.06 million reported in the year-ago quarter. It reported an 80% jump in delivery and branding revenues. During this period, Serve Robotics provided an average of 385 daily supply hours, indicating a 106% increase year over year.
SERV’s long-term prospects ride on growing demand for last-mile delivery of food and other items on partner platforms that include Uber Eats and 7-Eleven. The company, which was spun off from Uber Technologies UBER in 2021, counts NVIDIA, Uber, 7-Ventures and Delivery Hero’s corporate venture units as its strategic investors.
The company’s international expansion has also gained strong momentum driven by its partnerships with players like Shake Shack SHAK, Ouster OUST and Magna.
In June 2024, SERV expanded its delivery operations in Koreatown with the help of its partner, Uber Eats. Its latest partnership with SHAK expands SERV’s footprint in Los Angeles. SERV’s collaboration with Ouster is noteworthy. Serve Robotics’ robots with Ouster os1 sensor can generate a real-time 3D map of their surrounding environment, which helps them work more efficiently and accurately.
SERV reported an 85% rise in daily active robots year over year. SERV also planned to implement 2,000 robots under the Uber Eats agreement within 2025, which is expected to generate $60-$80 million in run-rate revenues annually.
SERV’s Earnings Estimates Reflect Upward Trend
Investors are turning bullish about the SERV stock, owing to its strength in robotics. This is reflected in the upward revision of the bottom-line estimate.
The Zacks Consensus Estimate for 2024 loss is pegged at 85 cents per share, which has narrowed down by a penny over the past 60 days.
What Investors Should Do With SERV Stock
SERV shares are currently trading at a discount to the industry average, making the stock more attractive on the valuation front.
The forward 12-month Price/Book ratio for SERV stands at 10.23, significantly below the Zacks IT services market at 22.33.
SERV’s innovative robotics offerings and expanding partner base indicate top-line growth in the long run. The stock’s attractive valuation makes it worth investing in right now.
Serve Robotics currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
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Serve Robotics Inc. (SERV) : Free Stock Analysis Report
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