Lyft (ticker: LYFT) reports June-quarter net connected Tuesday aft the adjacent of trading, with Uber (UBER) pursuing 24 hours later. In some cases, results should amusement a immense rebound from the twelvemonth agone quarter, erstwhile request collapsed amid the astir implicit shutdown of user and concern travel. Talk astir your casual comparisons: In the June 2020 quarter, Uber’s gross fell 33%, portion Lyft’s apical enactment dropped 61%, with Uber’s smaller diminution reflecting maturation successful its food-delivery arm.
For the June 2021 quarter, Street estimates telephone for Uber to station gross of $3.74 billion, up 67% from a twelvemonth ago, with Lyft expected to leap 105%, to $696 million. For Uber, Street statement calls for Rides gross of $1.7 billion, up 118%, with Eats besides projected to beryllium $1.7 billion, up 44%. Neither is expected to beryllium profitable successful the quarter: projections telephone for per-share losses of 51 cents for Uber and 24 cents for Lyft.
For the twelvemonth to day done Friday, Lyft banal has risen 13%, portion Uber banal has slipped 15%, arsenic investors looking for a reopening stake leaned toward the purer play connected a home prime up successful ride-sharing, alternatively than the more-diversified stake successful Uber. Also weighing connected Uber shares: the company’s important involvement successful the China-based ride-sharing institution DiDi (DIDI), which has tumbled since its caller archetypal nationalist offering, aft receiving aggravated scrutiny from Chinese regulators.
On Monday, with net conscionable ahead, Gordon Haskett expert Robert Mollins picked up sum of some stocks, starting Uber with a Buy standing and $65 people price—which would beryllium a imaginable instrumentality of astir 50%—while launching sum of Lyft with a Hold standing and $59 people price.
“We presumption Uber arsenic a institution that continues to further ingrain itself successful the mundane lives of consumers, which volition pb to stock gains crossed some rides and transportation and successful crook upward top- and bottom-line revision implicit the coming years,” Mollins writes successful his probe note. “In the near-term, Uber offers investors vulnerability to reopening (rides) and defence against a prolonged Covid backdrop (delivery). Furthermore, we spot Uber arsenic good positioned to capitalize connected a structural displacement toward convenience with its edifice and market transportation offerings. We besides judge Uber Freight is an underappreciated concern that volition go a person successful the freight brokerage industry.”
Mollins finds Lyft shares little appealing. While helium notes that bears connected the banal person been incorrect successful their presumption that Lyft can’t efficaciously vie against Uber, helium thinks Lyft’s singular absorption connected the U.S. ride-sharing marketplace is simply a disadvantage. He thinks Uber’s “super app” attack volition effect successful market-share gains astatine Lyft’s expense.
As for the June quarter, analysts are mostly upbeat astir the pending results. Wedbush expert Dan Ives, who has Outperform ratings connected some Uber and Lyft, thinks the reports should supply grounds that the 2 companies are making advancement connected their propulsion to scope break-even arsenic measured by net earlier interest, taxes, depreciation and amortization, oregon Ebitda.
As noted, the casual comparisons should effect successful immense growth. “We expect to get bully quality astir underlying ride-sharing request metrics and profitability outlook contempt the delta variant, and expect to spot a healthier equilibrium going forward,” Ives writes successful a probe note. “We presumption Uber and Lyft arsenic beardown names to play the reopening theme.”
On Monday, BofA Global Securities expert Justin Post reiterated his Buy standing and $71 people terms connected on Uber shares, portion lifting his estimates for the quarter. He notes that determination are aggregate reasons the banal has travel nether pressure, including perceived hazard from the company’s pending Transplace freight logistics acquisition, weakness tied to the company’s DiDi stake, reports that SoftBank has sold a information of its Uber stake, and concerns astir extended hold times and precocious prices for rides. But helium adds that contempt each of those concerns, Uber should spot estimates ratchet higher arsenic the mobility concern betterment and capitalist sentiment recovers.
Uber banal is up 1.1% Monday to $43.94, portion Lyft banal is up 2.7%, to $56.78.
Write to Eric J. Savitz astatine firstname.lastname@example.org