Lyft Stock News and Forecast: Can earnings LYFT this stock higher?
- LYFT shares fall in premarket on earnings.
- LYFT beats on top and bottom lines, but shares sink.
- LYFT catches a price target raise from UBS, but Wedbush lowers its target.
Lyft (LYFT) reported earnings after the close on Tuesday that at first glance looked positive. The taxi app beat on top and bottom lines with both revenue and earnings per share coming in ahead of estimates.
Lyft Stock News
Earnings per share came in at $0.09 versus the estimate for $0.08. Revenue also beat estimates at $970 million versus $940 estimated. Revenue per active rider was also strong with the number hitting $51.79 versus forecasts for $46.54. Lyft reported an increase of nearly 50% on yearly active riders but analysts had been looking for just over 20 million riders for the year when the actual number was 18.73 million according to CNBC. LYFT also said it expected the omicron surge to have affected Q1 2022 earnings. LYFT forecast revenue of between $800 to $850 million when analyst estimates were at $990 million. This is likely the main reason for LYFT shares dropping 5% in the after-hours market on Tuesday. Of note, for the airline stocks, LYFT said airport rides almost doubled in the quarter compared to a year earlier.
Analysts are mixed about the earnings this morning. Barclay's has lowered its price target to $47 and BTIG has lowered its target to $65. UBS meanwhile has raised its price target to $50 but Wedbush keeps its outperforming rating but lowers its price target to $50.
Lyft Stock Forecast
LYFT stock is in a classic downtrend. We do wonder just why the shares pushed so high in the middle of a global pandemic. Anyone can understand why lockdown stocks such as Peloton (PTON) and Zoom (ZM) took off, but we cannot see the logic here. Easy money perhaps chasing bubbles?
LYFT peaked in March 2021 and fell thereafter as the Delta wave took over, so perhaps too much reopening optimism was also a factor. Regardless, this earnings release saw LYFT rise 5% in advance, so the move in the afterhours is merely correcting that. The earnings are reasonably solid in our view with Omicron the only real cloud on the horizon. That cloud is beginning to fade.
Support is at $32.14 to fill the earnings gap back in November 2020. There is also a notable volume gap if LYFT breaks $35, which should see an acceleration to $30. Volume is strong at $30, which should stabilise things. Resistance is at $46, and this breaks the current downtrend.
LYFT chart, daily
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Author
Ivan Brian
FXStreet
Ivan Brian started his career with AIB Bank in corporate finance and then worked for seven years at Baxter. He started as a macro analyst before becoming Head of Research and then CFO.
