Lyft is a 'pure play around transportation'

Lyft is a 'pure play around transportation'

Lyft's business turned a profit on adjusted basis in the second quarter, Uber's didn't. Uber sees more profits ahead as people turn more mobile after getting a COVID 19 vaccination, taxi drivers' business outlook is a bit cloudier given its complexity.

That comparison right there explains why Lyft is an easier choice than Uber for pandemic recovery, thinks Lyft's long-time CFO Brian Roberts.

The two companies are really two different companies. We actually love that. I mean we are competing against this conglomerate and if you want to invest in freight, you have a choice. We are this pure play around transportation, said Roberts on Yahoo Finance Live.

Added Roberts, There are a lot of investors who are excited about this ability to just invest in transport and not worry about all of this food competition, lots of different players, aggressive companies out there on freight or all these other things.

Despite a pickup in driver incentives, Lyft was able to achieve adjusted EBITDA profitability for the first time in the second quarter. The company adjusted EBITDA to $350 million in the third quarter of the financial statement, which was measured to $35 million.

Meanwhile, Uber lost $509 million on an adjusted EBITDA basis in the second quarter. Corporate executives told analysts that they are committed to reaching profits this year on an earnings call.

Roberts analyst Brent Thill sees Lyft as a highly attractive re-opening, in large part because of the pure business model referenced by Jefferies.

Lyft is well positioned to benefit from the next quarter as a private-play product on U.S. bike-hailing. Current valuation 3.9 x CY 22 enterprise value sales remains attractive compared to vendor market peer median 3.8 X and broader comparable group median 5.8 x, Thill said in a research note to clients.