Downgrading Lyft To A Sell: Switching Cars

Summary

• Lyft, Inc.'s stock surged ~29% post Q3 2024 earnings and ~84% since my last buy call. I'm downgrading the stock to a sell and see limited upside ahead after the rally.
• Lyft's Price Lock initiative boosted rides and platform stickiness, but the market has priced in that positive, in my opinion. This leads me to expect moderating future outperformance.
• Despite Lyft's lower P/E and EV/Sales ratios compared to Uber, I recommend taking Lyft gains and investing in Uber for better near-term potential.
• Lyft Media's growth and new AV partnerships are promising for the longer term, but I don't see them bringing much to the table in the near term.
• I hereon share my sentiment on Lyft and why I see minimal upside ahead in the near term.

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Investment thesis:

Lyft, Inc. (NASDAQ:LYFT) reported Q3 2024 earnings Wednesday evening after the bell, shooting the stock price up to 29% higher the day after. Investors' confidence spiked despite Lyft missing EPS estimates

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.