Lyft has seen a substantial recovery from March lows; the stock is up 225% from March 16th and 11% since January 1st 2020. Fundamentals have continued to improve; however, the rideshare market is still weak and reliant on improving conditions around COVID 19. I believe all foreseeable growth in fundaments over the next 12 months are priced in and view Lyft as neutral with a price target of $55, implying a 14.5% upside. While Lyft remains reliant on COVID 19 vaccines and a return to normal with a Q4 2021 being a critical turning point, the company had success in November at the passing of California Proposition 22 removing significant cost increase risk. Looking long-term Lyft is poised to benefit from autonomous vehicles with partnerships with Waymo and Motional Inc. However, regulatory change to allow AV ride-hailing could be up to a decade away.

Full Report

Lyft Inc.

[NASDAQ:LYFT]

06 January 2021

Company Overview

Since becoming incorporated in 2007, changing names from Zimride to Lyft in 2013 and completing their IPO in 2019, Lyft has grown to a household name in North America only passed in notoriety by Uber. Lyft offers customers a peer-to-peer rideshare marketplace enabling drivers to provide transport services to riders. Lyft also offers on-demand scooters and bike, flexible car rental from third parties and enterprise transport solutions. Lyft offers public transport integration providing split journeys, special event services and Lyft Pink a subscription service offering discounts for frequent riders.

The company partnered with Alphabets Waymo in 2019 providing self-driving AVs to Lyft riders in Phoenix Arizona due to lax regulation and expected to expand as regulations over AVs reduce over the coming years. On December 16th 2020 Lyft agreed to a deployment partnership with Motional inc to have driverless rides in 2023.

Market Capitalization

$18.34B

YoY Revenue
Growth

125.40%

&nbsp
TTM Revenue

$2.44B

Price to Sales
Ratio

7.61

LMCR

Price Target

$600.00

Investment Thesis

Lyft has seen a substantial recovery from March lows; the stock is up 225% from March 16th and 11% since January 1st 2020. Fundamentals have continued to improve; however, the rideshare market is still weak and reliant on improving conditions around COVID 19. I believe all foreseeable growth in fundaments over the next 12 months are priced in and view Lyft as neutral with a price target of $55, implying a 14.5% upside.


While Lyft remains reliant on COVID 19 vaccines and a return to normal with a Q4 2021 being a critical turning point, the company had success in November at the passing of California Proposition 22 removing significant cost increase risk. Looking long-term Lyft is poised to benefit from autonomous vehicles with partnerships with Waymo and Motional Inc. However, regulatory change to allow AV ride-hailing could be up to a decade away.

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