Shares of Lyft (LYFT 0.18%) were accelerating this week after the No. 2 ridesharing company reported strong results in its first-quarter earnings report, showing it's well on its way to being a growing and profitable company.
Not surprisingly, Wall Street took notice of another round of solid numbers from Lyft, and one of the stock's top bulls lifted its price target on Lyft to $24, implying 39% upside in the ride-hailing stock.
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RBC sees Lyft going to $24
Analyst Brad Erickson maintained an outperform rating on the stock and lifted his price target by $1 to $24, approving of the company's latest report, and believed Lyft's guidance to be conservative, implying the company should be able to beat its forecast.
Erickson also noted the health of the overall ridesharing industry is improving, factoring in Uber's latest report as both companies have backed away from price competition in the form of driver and rider incentives in order to turn profitable.
Is Lyft a buy?
After a disastrous first few years as a public company that included wide losses and the impact of the pandemic, Lyft stock is looking surprisingly attractive.
Revenue in the first quarter jumped 28%. The company is now solidly free cash flow positive and expects to generate positive free cash flow for the year for the first time.
Meanwhile, Lyft is gaining traction with new initiatives like women+ connect, which allows women drivers and riders to preference matches with other women. It's also unlocked a new advertising business, tapping into a new revenue stream.
While the stock has bounced significantly off of earlier lows, there's still plenty of upside as Lyft's market cap is just $7 billion. If the company keeps executing, the stock should continue to move higher.
