UBS Reiterates Neutral Rating on Lyft (LYFT)
UBS analyst Lloyd Walmsley reiterated a Neutral rating and $19.00 price target on Lyft (NASDAQ: LYFT).
The analyst comments "We walk away from Lyft's first investor day directionally more positive as it set 2024- 2027 targets ahead of consensus. Key guidance parameters included: 1) 2024-2027 CAGR gross bookings (GBs) of c.15%, implying 4 ppt upside vs pre-event consensus of 11%, 2) 2027 Adjusted EBITDA margin of ~4%, implying up to 600bps upside vs consensus for 3.4%, and 3) annual free cash flow conversion of 90% or more vs consensus annual average of 87%. Incremental to the story was that Lyft is leveraging telemetrics data to drive insurance efficiency and Lyft Media is set to contribute more meaningfully at >$400M to GBs by 2027; both updates are margin-accretive and should improve outlook for 2027 and beyond. We maintain our Neutral rating for now, as we see Uber as better-positioned with ongoing benefits from rideshare/delivery cross platform synergies, better mid-term margin profile on No.1 rideshare category position in US, and announced capital returns."
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Shares of Lyft closed at $15.69 yesterday.