Lyft Stock Shows Upside Potential Amid Positive Trends

Lyft stock is set for potential growth, with analysts projecting an average price target of $18.69 per share, indicating nearly 40% upside. The company has recorded growth in active riders and rides, along with free cash flow turning positive.

Date: 08-02-2025

AI Rating: 7

Positive Business Trends
Lyft's active riders grew 9% year over year to 24.4 million in Q3, indicating the company is successfully attracting users. The number of rides also increased by 16%, totaling 217 million rides, which reflects growing demand for Lyft over competitors.

Free Cash Flow
Notably, Lyft has reached free cash flow positive for the first time in its history. This is a strong signal of financial health and management effectiveness since the new CEO took over in April 2023. Free cash flow is crucial for the company's ongoing operations and future investments.

Growth Potential and Valuation
Lyft's stock is currently valued significantly lower than Uber's, even though its revenue is growing faster. This discrepancy presents an attractive investment opportunity, especially since Lyft plans to enhance revenue through digital advertising, potentially growing to $400 million by 2027. The anticipated free cash flow target of $900 million for 2027 further solidifies its investment case.

Stocks: LYFT UBER