LYFT Soars 37% in 3 Months: Is the Stock Still Worth Betting on Now?

Lyft (LYFT) stock has surged 36.7% in the last three months, outperforming its industry peers, driven by a 13% year-over-year increase in Q1 gross bookings to $4.6 billion and a record 24.4 million active riders. The company's management has increased the share repurchase program to $750 million, with plans to utilize $200 million in the next three months, signaling confidence in future cash flow and a commitment to returning value to shareholders; analysts have also revised sales and EPS estimates northward for 2025 and 2026.

Analysis

Lyft (LYFT) has demonstrated significant stock appreciation, gaining 36.7% over the past three months, thereby outperforming its peers Uber Technologies (UBER) and DoorDash (DASH), as well as the broader Zacks Internet Services industry which returned 6.6%. This performance is underpinned by robust Q1 2025 results, where gross bookings increased 13% year-over-year to $4.6 billion, marking the 16th consecutive quarter of double-digit growth in this metric. The quarter also saw a record 24.4 million active riders, an 11% YoY increase, and a first-quarter record of 218.4 million total rides, up 16% YoY. Management has signaled confidence through an expanded share repurchase program, now totaling $750 million, with $200 million earmarked for execution in the next three months, supported by trailing 12-month cash flow generation approaching $1 billion. Lyft's outlook for Q2 2025 projects gross bookings between $4.41 billion and $4.57 billion (10-14% YoY growth) and adjusted EBITDA of $115-$130 million. Analyst sentiment appears positive, with consensus estimates for 2025 and 2026 sales indicating YoY increases of 12.7% and 12.9% respectively, and EPS growth of 16.8% and 21.2% for the same periods; EPS estimates for Q2, Q3, and full-year 2025 have also trended upwards. Notably, LYFT trades at a forward price/sales multiple of 0.95, considerably lower than the industry average of 5.2, and its stock is above its 50-day moving average, suggesting positive technical momentum.

Key Decisions for Investors

• Given LYFT's strong Q1 operational performance, positive forward guidance, and increased share repurchase authorization, investors might consider the stock's current momentum and growth trajectory.
• The stock's valuation, with a price/sales ratio of 0.95 significantly below the industry average, presents a potentially attractive entry point or an opportunity to add to existing positions, despite the recent share price rally.
• Investors should monitor Lyft's ability to sustain its double-digit gross bookings growth, continued expansion in active riders and total rides, and the execution of its strategy in less densely populated markets and autonomous vehicle partnerships.