Lyft Reports Solid Q1 Results, RBC Capital Raises Price Target

RBC Capital analysts increased their price target on Lyft (NASDAQ:LYFT) to $24.00 from $23.00, maintaining an Outperform rating, after the company’s Q1 report, which resulted in a stock price gain of more than 5% in pre-market today.

The quarterly performance was largely solid, featuring better-than-expected results and an improved outlook for the first and second quarters, while the full-year outlook was reiterated and appears increasingly conservative.

The analysts highlighted several positive developments: the marketplace is showing clear signs of improvement, which aligns with their previous upgrade. The company is also effectively managing higher insurance costs, evidenced by better margin guidance for Q2.

Additionally, the analysts anticipate that the upcoming analyst day on June 6th will provide further insights into Lyft's margin structure, long-term outlook, and potential plans for capital return, which could reveal underappreciated opportunities for margin expansion.

While the in-line full-year guidance suggests that the Q4 insurance cost increase poses some risk, the analysts believe this risk is diminishing due to strong execution in the first half of the year.