Investing

5 Gig Economy Stocks This Analyst Thinks Will Thrive in a Recession

Chris Lange

Published: May 26, 2022 9:35 am

Market futures were relatively higher to start off Thursday, but that is not to say this week has been without its ups and downs. Considering the recent stress markets have been under from current headwinds, one Wall Street analyst has some ideas involving the gig economy that could prove fruitful going forward.
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Inflation is still running rampant at levels not seen in over 40 years. At the same time, the labor market has been fairly resilient, with some of the lowest unemployment levels we have seen in a while. Even jobless claims have reached their lowest levels in the past 52 years (notwithstanding the current print coming Thursday morning).

The strength in the labor market is a good sign of recovery, but like most things, there must be a balance. So as unemployment continues lower, it is basically signaling that demand for jobs is increasing. Some economists speculate that this increase in demand is such that consumers can make more money to afford these historic levels of inflation. Economically speaking, once this reaches dire levels of demand, we could be in for some more trouble.

This is why the gig economy is so important. It offers consumers a way to make cash on the side in a flexible manner. The gig economy could very well be dealing with a surplus of labor going into the summer, which could play out well for the following five stocks. Even while the bears are still suggesting markets at large could go lower, Bernstein believes that these gig economy stocks can stand up to a potential recession, even a couple with over 50% upside.

Lyft

Lyft Inc. (NASDAQ: LYFT) operates a peer-to-peer marketplace for on-demand ridesharing in the United States and Canada. Lyft has been playing second fiddle to Uber for a while now in terms of market cap and footprint, but it offers a pure-play investment for ridesharing whereas Uber is diversified across foreign markets and even into food delivery. Bernstein started Lyft with a Market Perform rating and a $22 price target, which implies upside of 32% from the most recent closing price of $16.72.

Lyft stock was last seen trading around $17, in a 52-week range of $16.33 to $63.07. The consensus price target is $43.61.

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Etsy

Bernstein initiated coverage of Etsy Inc. (NASDAQ: ETSY) stock with an Outperform rating and a $105 price target, implying upside of 50% from the most recent close at $70.21. Etsy operates an online marketplace that connects buyers with sellers for custom-made artisanal goods. Some might even call this platform a “hipster eBay.” Etsy operates within the United States, United Kingdom, Germany, Canada, Australia, France and India.

Etsy stock was last seen trading around $73, in a 52-week range of $68.40 to $307.75. The consensus price target is $152.11.

eBay Inc. (NASDAQ: EBAY) acts as an online auction house, and it connects buyers with sellers in the United States and internationally. The firm also offers a suite of mobile apps that connects buyers, sellers, distributors, entrepreneurs, retailers and more. Bernstein initiated coverage on eBay stock with a Market Perform rating and a $50 price target, implying upside of 13% from the most recent closing price of $44.18.
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Shares of eBay were trading near $45 and have a consensus price target of $59.02. The 52-week range is $43.28 to $81.19.

DoorDash

This firm operates an online delivery platform that connects local merchants and restaurants to consumers via its delivery service. DoorDash Inc. (NYSE: DASH) operates within the United States and internationally. Bernstein started DoorDash with a Market Perform rating and a $90 price target, implying upside of 44% from the most recent closing price of $62.66.

DoorDash stock was trading around $69, in a 52-week range of $57.60 to $257.25. The consensus price target is $138.90.

Uber

Uber Technologies Inc. (NYSE: UBER) is considered the leading rideshare app in the world by both recognition and market cap. The firm has a global footprint reaching six continents, and it also has exposure to food delivery services, among other services. Bernstein resumed coverage on Uber with an Outperform rating but cut its $45 price target to $35, which still implies upside of 62% from the most recent closing price of $21.55.

Uber stock was last seen trading around $22, in a 52-week range of $21.27 to $52.36. The consensus price target is $51.82.