Benchmark analysts upgraded Lyft (NASDAQ:LYFT) to Buy from Hold, setting a new price target of $20 per share on the stock. The upgrade reflects optimism around Lyft’s strategic initiatives and potential for growth, positioning the company as a top idea for 2025.
Lyft’s decision to reduce surge pricing while expanding its Price Lock platform is expected to boost rider engagement and drive positive momentum in key metrics. Additionally, Lyft’s ongoing expansion through partnerships, both in traditional ride-hailing and autonomous vehicles (AV), is anticipated to deliver near-term gains. The company’s domestic focus and smaller market share compared to Uber provide an opportunity to capture incremental growth in North America and position itself for global expansion.
Lyft’s Flexdrive platform is seen as a pivotal asset, enabling the company to participate in the evolving AV landscape regardless of how the market develops. While uncertainty remains around the broader economic model for AVs, Lyft’s approach ensures flexibility and adaptability in this rapidly changing space.
The company’s financial trajectory is also improving, with a free cash flow inflection already underway and GAAP EPS expected to follow. This progress could attract new investors, particularly as Lyft transitions from debt reduction to capital returns. While recent takeover rumors are not factored into this analysis, they could provide additional support to the stock’s valuation in the long term.