Lyft Receives Analyst Upgrades Post-Earnings

On February 14, 2024, Lyft (LYFT) stock experienced a surge in analyst upgrades following its earnings report released the day prior. Let’s delve into the details of these upgrades and what they mean for Lyft’s future prospects.

Analyst Upgrades Overview

Several prominent financial institutions revised their price targets and ratings for Lyft stock based on the company’s latest earnings performance and forward guidance. Here’s a breakdown of the key upgrades:

BofA: Price Target Raised to $12.50

BofA raised Lyft’s price target to $12.50 from $10.50 but maintained an Underperform rating on the shares. While the firm acknowledged Lyft’s “mixed” earnings results, including a bookings beat, it expressed concerns about the company’s growth and margin expansion compared to its competitor Uber (UBER). Despite higher bookings and a lower assumed rate of annual dilution from share-based compensation, BofA reiterated its Underperform rating due to anticipated share losses to Uber.

Deutsche Bank: Price Target Raised to $15

Deutsche Bank lifted its price target on Lyft to $15 from $11 while maintaining a Hold rating on the shares. The firm likely adjusted its target based on Lyft’s healthy Q4 results, which surpassed expectations in terms of total bookings and adjusted EBITDAUnderstanding Adjusted EBITDA: A Comprehensive Guide In the world of finance and business valuation, financial metrics play a crucial role in assessing a company's health, performa... More. Moreover, Lyft’s management provided optimistic guidance for 2024, anticipating mid-teens year-over-year growth in rides and slightly faster growth in gross bookings.

Wedbush: Price Target Increased to $15

Wedbush raised its price target on Lyft to $15 from $14 and retained a Neutral rating on the shares. The firm highlighted Lyft’s robust Q4 performance, with total bookings exceeding expectations and adjusted EBITDA outperforming consensus estimates by $11 million. Wedbush also noted Lyft’s positive outlook for 2024, expecting continued growth in rides and bookings per ride.

Truist: Price Target Lifted to $15

Truist increased its price target on Lyft to $15 from $13 and maintained a Hold rating on the shares. The firm praised Lyft’s strategic initiatives implemented in early 2023, which led to accelerating growth in rides and rides’ frequency during Q4. Truist expressed optimism about Lyft’s prospects in Q1, anticipating sustained momentum following a healthier marketplace.

Piper Sandler: Price Target Upgraded to $17

Piper Sandler raised its price target on Lyft to $17 from $14 and upheld an Overweight rating on the shares. The firm attributed the after-hours upside in Lyft’s stock to better-than-expected 2024 gross bookings guidance, along with expectations for higher margins and positive free cash flowThe cash flow statement provides a detailed overview of the cash inflows and outflows of a company over a specified period of time. It includes cash received from operations, inves... More. Piper Sandler expressed encouragement over Lyft’s improved performance relative to Uber (UBER).

Loop Capital: Price Target Elevated to $15

Loop Capital adjusted its price target on Lyft to $15 from $12 while maintaining a Hold rating on the shares. The firm commended Lyft’s solid Q4 results, including upside to adjusted EBITDA and an optimistic outlook from management. Loop Capital’s price target increase reflected an adjustment in its assumed EBITDA multiple.

Citi: Price Target Revised to $15

Citi raised its price target on Lyft to $15 from $13 and retained a Neutral rating on the shares. The firm described Lyft’s Q4 performance as “encouraging” and highlighted the positive outlook for 2024, suggesting potential upside to its Q2-Q4 estimates.

Lyft Optimistic Outlook for 2024

The series of analyst upgrades underscore the growing confidence in Lyft’s future trajectory following its recent earnings report. While challenges remain, particularly in competition with Uber, Lyft’s strategic initiatives and optimistic outlook for 2024 have garnered favorable attention from analysts. Investors will closely monitor Lyft’s execution against its projections in the coming quarters to assess its long-term growth potential in the competitive ridesharing market.