Benchmark maintains Lyft stock Buy rating, $20 price target

Wednesday, Benchmark analyst Daniel L. Kurnos maintained a Buy rating and a $20.00 price target on shares of ride-sharing company Lyft , Inc. (NASDAQ:LYFT), aligning closely with InvestingPro’s Fair Value assessment which suggests the stock is currently undervalued. Kurnos addressed the competitive dynamics between Lyft and its rival Uber Technologies, Inc. (NYSE:UBER), noting that despite both companies claiming stable market share and overall pricing, Lyft lost the latest competitive exchange. He pointed out that Lyft has experienced challenges with pricing strategies and the loss of its partnership with Delta, which could present a low-single digit headwind for the company’s bookings growth.

Kurnos mentioned that Lyft’s recent earnings reflected the impact of competitive pricing strategies that persisted through the previous day. Despite challenges, InvestingPro data shows impressive revenue growth of 25.4% over the last twelve months, with analysts expecting continued growth this year. The termination of the Delta partnership could further affect Lyft’s performance, adding a 200 basis point headwind. Despite these challenges, Kurnos remains optimistic about Lyft’s growth potential, noting that consensus estimates were already over $1 billion below the company’s 2027 gross bookings target and over $100 million below the EBITDA target.

The analyst compared Lyft’s first quarter 2025 mobility outlook with Uber’s, suggesting similarities in their projections. According to InvestingPro, which offers 8 additional key insights about Lyft’s financial health, the company maintains a GOOD overall financial health score of 2.65. The analyst highlighted that Lyft’s stock might trade down to a 10x 2026E EBITDA range, which could present an attractive growth-at-a-reasonable-price (GARP) opportunity. Kurnos also pointed out Lyft’s recent announcement of a new $500 million stock buyback program, which could signal confidence in the company’s financial prospects.

Despite Lyft’s difficult start to the year, Kurnos identified the company as one of his top GARP ideas and names for the year. He emphasized the potential for Lyft to achieve efficiency gains and to attract investor interest, despite the skepticism surrounding the company’s ability to meet its long-term targets. For deeper insights into Lyft’s valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which provides detailed analysis of the company’s financial health and future potential. Kurnos’s endorsement comes amid a competitive landscape where both Lyft and Uber are vying for market dominance in the ride-sharing industry.

In other recent news, Lyft’s stock target has been adjusted by several analyst firms following its fourth-quarter earnings report. Cantor Fitzgerald cut the target to $14, citing a bookings miss and a lower-than-expected projection for bookings growth. Despite exceeding EBITDA expectations, the firm maintains a neutral rating due to uncertainties in short-term growth prospects.

JPMorgan reduced its target to $16, noting an intensifying competitive landscape and the impending loss of Lyft’s partnership with Delta. Despite Lyft’s improvements in product innovation and service enhancements, the firm revised its gross bookings forecasts and EBITDA predictions downward.

Evercore ISI also lowered its price target for Lyft to $15, maintaining an ’In Line’ rating. The firm highlighted the need for consistent improvement in Lyft’s fundamentals for any future rating changes. Goldman Sachs, on the other hand, maintained a neutral rating on Lyft with a $20 target, emphasizing Lyft’s progress in operational and financial Key Performance Indicators.

Lastly, Truist Securities cut Lyft’s stock price target to $17 from $20, maintaining a Hold rating. While acknowledging Lyft’s efforts to enhance customer experience and product innovation, the firm remains cautious due to near-term pricing pressures. These are recent developments, reflecting analysts’ responses to Lyft’s latest financial performance and future outlook.

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