Please ensure Javascript is enabled for purposes of website accessibility

Why Lyft's Stock Is Down Today

By John Rosevear – May 4, 2020 at 2:19PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Analysts are worried about weak demand later in 2020.

What happened

Shares of ridesharing service Lyft (LYFT 1.24%) were trading lower on Monday, after two analysts cut their price targets for the stock ahead of the company's first-quarter earnings report.

As of 2 p.m. EDT today, Lyft's shares were down about 10.8% from Friday's closing price.

So what

In a note on Monday, Credit Suisse analyst Stephen Ju cut his price target for Lyft's stock to $75, from $96, while maintaining the equivalent of a buy rating. Ju said that he has cut his estimates for Lyft's rideshare bookings for the remainder of the year. He now expects bookings to fall 91% from 2019, on lower numbers of active riders, less frequent rides, and lower average selling prices. 

Riders in a car with a lit Lyft sign on the dashboard.

Image source: Lyft.

SunTrust analyst Youssef Squali is thinking along similar lines. In his Monday note, Squali cut his price target for Lyft to $45, from $74, while maintaining a buy rating.

Squali noted that Lyft announced major cost cuts last week and said that he expected to see "soft demand trends" when the company reports its first-quarter results later this week. He cut his full-year revenue estimate to $2.9 billion, from $4.7 billion, on concerns about weak demand in the current quarter and the lack of visibility as to when the economy will recover from the COVID-19 shutdowns.

Now what

Tech investors should expect Lyft's senior management to address these concerns (among others) when the company reports its first-quarter results after the market closes on Wednesday, May 6. 


John Rosevear has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Lyft Stock Quote
$13.92 (1.24%) $0.17

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/06/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.