Shares of Lyft (LYFT, Financial) experienced a significant surge today, advancing by 23.06%. This positive movement comes after the company revealed robust third-quarter earnings, highlighted by a record number of trips.
Lyft's (LYFT, Financial) performance in the third quarter was impressive, with gross bookings increasing by 16%, which propelled revenue to $1.52 billion, a 32% increase from the previous quarter and exceeding the anticipated $1.44 billion. This success is attributed to the company's strategic implementation of more effective incentives for riders and drivers. Additionally, active riders grew by 9% to reach 24.4 million, accompanied by a 16% rise in the number of rides, totaling 217 million.
In terms of financial metrics, adjusted EBITDA climbed from $92 million to $107.3 million. Despite a flat GAAP loss per share of $0.03, which was markedly better than the projected loss of $0.20, investor sentiment towards Lyft's (LYFT, Financial) future remains positive.
Looking ahead, Lyft (LYFT, Financial) projects gross bookings to expand by 15% to 17%, reaching between $4.28 billion and $4.35 billion in the upcoming quarter. The company also forecasts an adjusted EBITDA range of $100 million to $105 million. It has revised its adjusted EBITDA margin guidance upward from 2.1% to 2.3% for the full year.
From a stock analysis and valuation perspective, Lyft (LYFT, Financial) currently trades at $17.72. The company is classified as a Speculative Growth stock and carries a GF Value of $17.49, which indicates that it is fairly valued. For more comprehensive valuation metrics, refer to the GF Value page.
Despite Lyft's (LYFT, Financial) remarkable quarterly results, it's crucial to consider some financial vulnerabilities. The company's Altman Z-score of -1.35 places it in the distress zone, suggesting potential bankruptcy risks in the next two years. Conversely, Lyft's Beneish M-Score of -2.71 indicates that it is unlikely to be a manipulator.
For investors monitoring Lyft (LYFT, Financial), the stock's recent insider buying activity may provide some reassurance, as a notable insider has acquired 51,815 shares in the last three months. However, potential investors should remain cautious, given Lyft's (LYFT) current financial challenges and market volatility.
