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LYFT Soars 37% in 3 Months: Is the Stock Still Worth Betting on Now?
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Key Takeaways
LYFT stock jumped 36.7% in 3 months, beating peers and the Internet Services industry average.
Q1 gross bookings rose 13% to $4.6B, with record 24.4M active riders and 218.4M total rides.
LYFT raised its share buyback to $750M, planning to use $200M in the next 3 months alone.
Lyft (LYFT - Free Report) has delivered a solid 36.7% gain over the past three months. This performance easily beats the Zacks Internet Services industry, which returned 6.6% during the same period. The stock has also moved ahead of rival Uber Technologies (UBER - Free Report) and fellow industry player DoorDash (DASH - Free Report) . Shares of Uber and DoorDash have risen 23.3% and 18.3%, respectively, over the past three months.
3-Month Price Comparison
Image Source: Zacks Investment Research
Given LYFT’s impressive rally, investors might wonder if the opportunity to add this high-flying stock to their portfolio has passed. However, we believe LYFT has a lot going in its favor, and this rally is far from over. In fact, the stock holds substantial upside potential. LYFT currently has a Momentum Score of B. Technical indicators suggest continued strong performance for LYFT. The stock trades above its 50-day moving average, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in LYFT’s prospects.
50-Day Moving Average Data of LYFT Stock
Image Source: Zacks Investment Research
Reasons for Staying Bullish on LYFT Stock
Gross Booking Growth: Lyft released its first-quarter 2025 earnings report last month. In the March quarter, gross bookings increased 13% year over year to $4.6 billion. Management stated that this was the 16th consecutive quarter where Lyft demonstrated double-digit year-on-year growth in the key metric, demonstrating the resilience and momentum of the company’s customer-friendly strategy. The uptick was driven by the record active riders of 24.4 million in the quarter. Active riders increased 11% year over year in the quarter. The total number of rides in the quarter reached a first-quarter record 218.4 million, reflecting a year-over-year increase of 16%. These exceptional numbers highlight that the innovations introduced by LYFT this year to attract drivers and riders are bearing fruit. LYFT’s move to focus on less densely populated markets, such as Indianapolis, is also paying off.
Impressive Earnings Surprise History: Despite the tough conditions, the ride-sharing company demonstrated resilience and beat the Zacks Consensus Estimate for earnings in three of the past four quarters, missing the mark in the other quarter. The average beat is 24.2%.
Impressive Outlook: For the second quarter of 2025, Lyft expects gross bookings in the $4.41-$4.57 billion range, reflecting 10-14% growth from second-quarter 2024 actuals. The Zacks Consensus Estimate is currently pegged at $4.49 billion. The adjusted EBITDA is estimated to be $115-$130 million, and the adjusted EBITDA margin (calculated as a percentage of gross bookings) is expected to be 2.6-2.8%. Lyft anticipates year-over-year ride growth in the mid-teens.
Share Buyback Boost: In a shareholder-friendly move, management announced last month an increase to its share repurchase program to $750 million from $500 million. Lyft intends to utilize $500 million of this authorization within the next 12 months, $200 million of which will be used within the next three months. Strong cash flow generation allows LYFT to remain committed to returning value to shareholders. LYFT’s cash flow generation is approaching $1 billion for the trailing 12 months.
Zacks Estimates Northbound: The Zacks Consensus Estimate for LYFT’s 2025 and 2026 sales implies a year-over-year increase of 12.7% and 12.9%, respectively. The consensus mark for LYFT’s 2025 EPS and 2026 highlights a 16.8% and 21.2% year-over-year uptick, respectively. Moreover, the EPS estimates for second-quarter 2025, third-quarter 2025 and full year 2025 have been trending northward over the past 60 days, reflecting analysts' bullishness on LYFT.
Image Source: Zacks Investment Research
Compelling Stock Valuation: From a valuation perspective, Lyft is still trading cheaper than the industry. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.95, much lower than the industry average of 5.2. The company has a Value Score of B, comparing favorably to Uber Technologies’ D and DoorDash’s F.
Image Source: Zacks Investment Research
LYFT Still a Smart Buy for Investors
Lyft is likely to continue benefiting from strong gross bookings. Lyft’s ambitions to be a key player in the lucrative and emerging autonomous vehicle market also bode well. Lyft has inked quite a few deals in this respect. By adopting this approach, LYFT has avoided massive R&D costs associated with developing autonomous systems independently. The recent signs of the easing of tariff tensions are further tailwinds for the stock. The favorable valuation picture and rising earnings and sales estimates add to its appeal.
With many positives driving the stock, LYFT presents a compelling investment opportunity now. This Zacks Rank #2 (Buy) undervalued stock is an ideal candidate for addition to one’s portfolio.
Image: Bigstock
LYFT Soars 37% in 3 Months: Is the Stock Still Worth Betting on Now?
Key Takeaways
Lyft (LYFT - Free Report) has delivered a solid 36.7% gain over the past three months. This performance easily beats the Zacks Internet Services industry, which returned 6.6% during the same period. The stock has also moved ahead of rival Uber Technologies (UBER - Free Report) and fellow industry player DoorDash (DASH - Free Report) . Shares of Uber and DoorDash have risen 23.3% and 18.3%, respectively, over the past three months.
3-Month Price Comparison
Given LYFT’s impressive rally, investors might wonder if the opportunity to add this high-flying stock to their portfolio has passed. However, we believe LYFT has a lot going in its favor, and this rally is far from over. In fact, the stock holds substantial upside potential. LYFT currently has a Momentum Score of B. Technical indicators suggest continued strong performance for LYFT. The stock trades above its 50-day moving average, signaling robust upward momentum and price stability. This technical strength underscores positive market sentiment and confidence in LYFT’s prospects.
50-Day Moving Average Data of LYFT Stock
Reasons for Staying Bullish on LYFT Stock
Gross Booking Growth: Lyft released its first-quarter 2025 earnings report last month. In the March quarter, gross bookings increased 13% year over year to $4.6 billion. Management stated that this was the 16th consecutive quarter where Lyft demonstrated double-digit year-on-year growth in the key metric, demonstrating the resilience and momentum of the company’s customer-friendly strategy. The uptick was driven by the record active riders of 24.4 million in the quarter. Active riders increased 11% year over year in the quarter. The total number of rides in the quarter reached a first-quarter record 218.4 million, reflecting a year-over-year increase of 16%. These exceptional numbers highlight that the innovations introduced by LYFT this year to attract drivers and riders are bearing fruit. LYFT’s move to focus on less densely populated markets, such as Indianapolis, is also paying off.
Impressive Earnings Surprise History: Despite the tough conditions, the ride-sharing company demonstrated resilience and beat the Zacks Consensus Estimate for earnings in three of the past four quarters, missing the mark in the other quarter. The average beat is 24.2%.
Lyft Price and EPS Surprise
Lyft, Inc. price-eps-surprise | Lyft, Inc. Quote
Impressive Outlook: For the second quarter of 2025, Lyft expects gross bookings in the $4.41-$4.57 billion range, reflecting 10-14% growth from second-quarter 2024 actuals. The Zacks Consensus Estimate is currently pegged at $4.49 billion. The adjusted EBITDA is estimated to be $115-$130 million, and the adjusted EBITDA margin (calculated as a percentage of gross bookings) is expected to be 2.6-2.8%. Lyft anticipates year-over-year ride growth in the mid-teens.
Share Buyback Boost: In a shareholder-friendly move, management announced last month an increase to its share repurchase program to $750 million from $500 million. Lyft intends to utilize $500 million of this authorization within the next 12 months, $200 million of which will be used within the next three months. Strong cash flow generation allows LYFT to remain committed to returning value to shareholders. LYFT’s cash flow generation is approaching $1 billion for the trailing 12 months.
Zacks Estimates Northbound: The Zacks Consensus Estimate for LYFT’s 2025 and 2026 sales implies a year-over-year increase of 12.7% and 12.9%, respectively. The consensus mark for LYFT’s 2025 EPS and 2026 highlights a 16.8% and 21.2% year-over-year uptick, respectively. Moreover, the EPS estimates for second-quarter 2025, third-quarter 2025 and full year 2025 have been trending northward over the past 60 days, reflecting analysts' bullishness on LYFT.
Compelling Stock Valuation: From a valuation perspective, Lyft is still trading cheaper than the industry. Going by its price/sales ratio, the company is trading at a forward sales multiple of 0.95, much lower than the industry average of 5.2. The company has a Value Score of B, comparing favorably to Uber Technologies’ D and DoorDash’s F.
LYFT Still a Smart Buy for Investors
Lyft is likely to continue benefiting from strong gross bookings. Lyft’s ambitions to be a key player in the lucrative and emerging autonomous vehicle market also bode well. Lyft has inked quite a few deals in this respect. By adopting this approach, LYFT has avoided massive R&D costs associated with developing autonomous systems independently. The recent signs of the easing of tariff tensions are further tailwinds for the stock. The favorable valuation picture and rising earnings and sales estimates add to its appeal.
With many positives driving the stock, LYFT presents a compelling investment opportunity now. This Zacks Rank #2 (Buy) undervalued stock is an ideal candidate for addition to one’s portfolio.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.