Lyft gets boost from Argus, sees 22% upside for shares
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On Tuesday, Argus raised its rating on shares of Lyft Inc. (NASDAQ:LYFT) to Buy from Hold, with a new price target set at $20.00. This adjustment reflects an anticipated total return of around 22% from the current stock price. The upgrade is based on the company’s recent performance improvements and strategic advancements under the guidance of its new CEO, David Risher.
The firm noted that Lyft has made significant progress in reducing costs and enhancing operational efficiency, which has positioned the company to benefit from positive trends within the ridesharing industry. Argus highlighted Lyft’s efforts in streamlining operations, which have contributed to the company’s strengthened position in the market.
In addition to operational improvements, the ridesharing company’s financial outlook was a key factor in the rating change. Lyft’s announcement, made during its fourth-quarter earnings release for 2023, to achieve free cash flow positivity in 2024 was particularly influential. This declaration was interpreted as a strong signal of confidence from Lyft’s management in the company’s growth trajectory and the overall health of the ridesharing industry for the upcoming year.
Argus’s optimistic outlook is also supported by Lyft’s performance in the fourth quarter of 2023. The company’s commitment to becoming free cash flow positive is seen as a crucial step in demonstrating its potential for sustainable growth and profitability.
The new price target and upgraded rating reflect a positive view on Lyft’s future, suggesting that the company’s strategic initiatives and industry conditions could lead to rewarding outcomes for investors. Argus’s analysis indicates that Lyft’s stock may offer an attractive investment opportunity at its current valuation.
