UPDATE: Bernstein Starts Lyft (LYFT) at Market Perform

Bernstein analyst Nikhil Devnani initiates coverage on Lyft (NASDAQ: LYFT) with a Market Perform rating and a price target of $22.00.

The analyst comments "On paper, Lyft looks to be a clean re-open play, but there has been no follow through in the stock. Despite re-opening dynamics, the shortfall in driver supply and the subsequent risk to EBITDA have weighed on shares. Lyft's valuation is inexpensive, but the stock will remain in limbo until it can prove that drivers are returning and sticking around even as incentives taper. US rideshare is fighting the narrative that the driver supply funnel is structurally broken, which will take a quarter or two at least. On the demand side, we would like to see Lyft's Active Rider growth get back on track as well, a metric that has missed us the past two quarters. Long-term, we worry that Lyft's singular focus on North American mobility is a risk to growth with US rideshare likely mid-cycle already. The good news is that the US has been rationalizing and there's room for solid operating leverage in 2022/23. The magnitude will depend on how much of the incremental driver cost is passed on to customers. Comparatively, Uber offers similar operating leverage potential with greater optionality and diversification, hence our preference for Uber over Lyft."

For an analyst ratings summary and ratings history on Lyft click here. For more ratings news on Lyft click here.

Shares of Lyft closed at $19.07 yesterday.

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