Lyft's Looming Results Don't Inspire Analyst Confidence

(Bloomberg) -- Lyft Inc.’s first earnings report on May 7 offers low visibility for investors with no forecast from the company and a wide range of estimates from analysts covering the stock.

Guggenheim analyst Jake Fuller said despite focus on Lyft’s growth profile and path to profitability, there’s been “very limited talk” about specific expectations for the first quarter. At a high level, he expects revenue and rider growth to slow while take-rate is flat sequentially and contribution margin expands. He estimates earnings before interest, taxes, depreciation and amortization will be a loss of more than $300 million.

Lyft's Looming Results Don't Inspire Analyst Confidence

“Our sense is that there is a general expectation for moderating growth in riders and limited upside potential in take-rate,” Fuller said in a note to clients Monday. “There is no expectation for near-term profitability, but investors will likely dig for any signs that LYFT can reduce insurance costs, driver incentives, and rider incentives.”

Separately, Fuller outlined how Lyft will probably need to ramp up spending on autonomous vehicles in the coming years as it tries to catch up with rival Uber Technologies Inc. and even bigger budgets for Alphabet Inc.’s Waymo and General Motors Co. This could be a growing headwind for Lyft that clouds the path to profitability, according to Fuller, who has a neutral rating on the stock.

Lyft shares fell 0.5 percent at 9:33 a.m. in New York, extending a two-day slump.

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