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Why Is Lyft (LYFT) Down 2.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for Lyft (LYFT - Free Report) . Shares have lost about 2.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Lyft due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Lyft Beats on Revenues in Q2
Lyft incurred a loss (excluding 70 cents from non-recurring items) of 6 cents per share in the second quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of 23 cents. The amount of loss narrowed significantly from the year-ago period when coronavirus-led restrictions caused a dramatic drop in ride volumes.
Total revenues of $765 million also outperformed the Zacks Consensus Estimate of $701.2 million. The top line surged more than 100% year over year due to 97.3% rise in Active Riders (riders who take at least one ride during a quarter on Lyft’s multimodal platform through its app). Active Riders totaled 17.14 million in the quarter under review. This San Francisco-based company’s Revenue per Active Rider increased 14.3% year over year to $44.63.
Lyft’s second-quarter performance improved sequentially as well, reflecting continued recovery in rideshare rides. Total revenues increased 26% from the first quarter of 2021 with 27% rise in Active Riders.
During the second quarter, Lyft generated adjusted EBITDA profits for the first time, thus achieving its goal of adjusted EBITDA profitability earlier by a quarter. Second-quarter adjusted EBITDA of $23.8 million improved $304.1 million year over year and by $96.8 million sequentially. Adjusted EBITDA margin for the second quarter was 3.1% against adjusted EBITDA loss margin of 82.6% in the year-ago period. In the first quarter of 2021, adjusted EBITDA loss margin was 12%.
Total costs and expenses climbed 21.6% year over year to $1 billion in the quarter. Contribution improved more than 200% year over year to $452 million. Contribution margin increased to 59.1% from 34.6% in the year-ago period. Lyft, carrying a Zacks Rank #3 (Hold), exited the second quarter with unrestricted cash, cash equivalents and short-term investments of $2.2 billion compared with $2.25 billion at the end of 2020.
Q3 Outlook
Lyft expects revenues of $850-$860 million for the third quarter of 2021, implying a surge of 70-72% year over year and an 11-12% rise sequentially. The company’s guidance includes an estimated impact of $30-$40 million from low prices for rides and costs associated with driver bonuses and incentives. Lyft stated that if rise in demand is strong enough, it will continue to make investments in drivers.
The company anticipates contribution margin of 58.5-59% in the third quarter. Adjusted EBITDA is predicted in the band of $25-$35 million while adjusted EBITDA margin is estimated to be 3-4% in the current quarter.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
At this time, Lyft has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Lyft has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Lyft (LYFT) Down 2.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Lyft (LYFT - Free Report) . Shares have lost about 2.3% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Lyft due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Lyft Beats on Revenues in Q2
Lyft incurred a loss (excluding 70 cents from non-recurring items) of 6 cents per share in the second quarter of 2021, narrower than the Zacks Consensus Estimate of a loss of 23 cents. The amount of loss narrowed significantly from the year-ago period when coronavirus-led restrictions caused a dramatic drop in ride volumes.
Total revenues of $765 million also outperformed the Zacks Consensus Estimate of $701.2 million. The top line surged more than 100% year over year due to 97.3% rise in Active Riders (riders who take at least one ride during a quarter on Lyft’s multimodal platform through its app). Active Riders totaled 17.14 million in the quarter under review. This San Francisco-based company’s Revenue per Active Rider increased 14.3% year over year to $44.63.
Lyft’s second-quarter performance improved sequentially as well, reflecting continued recovery in rideshare rides. Total revenues increased 26% from the first quarter of 2021 with 27% rise in Active Riders.
During the second quarter, Lyft generated adjusted EBITDA profits for the first time, thus achieving its goal of adjusted EBITDA profitability earlier by a quarter. Second-quarter adjusted EBITDA of $23.8 million improved $304.1 million year over year and by $96.8 million sequentially. Adjusted EBITDA margin for the second quarter was 3.1% against adjusted EBITDA loss margin of 82.6% in the year-ago period. In the first quarter of 2021, adjusted EBITDA loss margin was 12%.
Total costs and expenses climbed 21.6% year over year to $1 billion in the quarter. Contribution improved more than 200% year over year to $452 million. Contribution margin increased to 59.1% from 34.6% in the year-ago period. Lyft, carrying a Zacks Rank #3 (Hold), exited the second quarter with unrestricted cash, cash equivalents and short-term investments of $2.2 billion compared with $2.25 billion at the end of 2020.
Q3 Outlook
Lyft expects revenues of $850-$860 million for the third quarter of 2021, implying a surge of 70-72% year over year and an 11-12% rise sequentially. The company’s guidance includes an estimated impact of $30-$40 million from low prices for rides and costs associated with driver bonuses and incentives. Lyft stated that if rise in demand is strong enough, it will continue to make investments in drivers.
The company anticipates contribution margin of 58.5-59% in the third quarter. Adjusted EBITDA is predicted in the band of $25-$35 million while adjusted EBITDA margin is estimated to be 3-4% in the current quarter.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended upward during the past month.
VGM Scores
At this time, Lyft has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock was allocated a grade of F on the value side, putting it in the lowest quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Lyft has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.