TD Cowen has shown a modest increase in confidence in Lyft Inc. (NASDAQ: NASDAQ:LYFT), adjusting the price target slightly upward to $16 from the previous $15 while maintaining a Hold rating on the stock.
The firm's analysis anticipates a 26.0% year-over-year revenue increase for the third quarter of 2024, which marks a deceleration from the 40.6% growth seen in the second quarter of the same year.
The analyst from TD Cowen projects that Lyft's third-quarter revenue will be around $1.46 billion, which is a 1.0% increase compared to the consensus. This growth is expected despite a deceleration in growth bookings, which are predicted to rise 14.2% year-over-year, a slowdown attributed to tougher year-over-year comparisons.
EBITDA forecasts for Lyft are set at $93.2 million, which is within the company's guidance range of $90 million to $95 million and slightly higher than the consensus estimate of $94.1 million. The slight year-over-year improvement in EBITDA is noted as a point of interest for investors, particularly as they look towards rideshare trends moving into October.
In other recent news, Lyft has been the center of several significant developments. The ride-hailing company recently reported its first-ever GAAP profitability, with a net income of $5 million for the second quarter, and a record number of 23.7 million active riders. In addition, Lyft's Media division saw a significant revenue increase. Wolfe Research maintained its Peerperform rating on Lyft shares, indicating a cautious outlook on the company's strategic moves and market positioning.
The company renewed its commercial insurance partnership with Mobilitas Insurance Companies, reflecting both companies' commitment to providing secure and efficient transportation options. Raymond James initiated coverage on Lyft with a Market Perform rating, expressing uncertainties about the company's autonomous vehicle strategy. Cantor Fitzgerald initiated coverage with a Neutral rating, while TD Cowen maintained its Hold rating.
InvestingPro Insights
To complement TD Cowen's analysis, recent data from InvestingPro offers additional insights into Lyft's financial position and market performance. The company's market capitalization stands at $5.74 billion, reflecting investor sentiment in light of recent developments.
InvestingPro Tips highlight that Lyft's net income is expected to grow this year, aligning with TD Cowen's projections of improved EBITDA. This potential profitability is further supported by analysts' predictions that the company will be profitable this year, despite not being profitable over the last twelve months.
Lyft's revenue growth remains strong, with InvestingPro data showing a 19.88% increase over the last twelve months, and an impressive 40.64% quarterly growth as of Q2 2024. This data corroborates TD Cowen's forecast of continued revenue growth, albeit at a decelerating rate.
It's worth noting that Lyft's stock price movements are quite volatile, which investors should consider alongside TD Cowen's Hold rating. The company's Price to Book ratio of 9.93 suggests a high valuation relative to its book value, which may be a factor in the cautious stance taken by analysts.
For investors seeking a more comprehensive analysis, InvestingPro offers 11 additional tips on Lyft, providing a broader perspective on the company's financial health and market position.
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