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Lyft (NASDAQ:LYFT) reported Q1 gross bookings of $4.16 billion, up 13% year-over-year and slightly above the $4.15 billion consensus, sending shares up over 22% in Friday afternoon trading.
The ride-hailing firm also supercharged its capital return program, increasing its share buyback authorization by 50% to $750 million from $500 million, underscoring confidence in cash flow generation.
Goldman Sachs analyst Eric Sheridan lifted his rating to Buy from Neutral and nudged his price target to $20 (from $19), arguing that Lyft's earnings power over the next two to three years is dislocated from current valuation and highlighting potential gains from autonomous-vehicle partnerships and fleet-owner deals. Meanwhile, Engine CapitalLyft's prominent activist investorpulled its board slate and shelved calls for strategic alternatives after the buyback announcement, removing a layer of governance uncertainty.
Why It Matters: The convergence of modest booking beats, a more aggressive buyback and activist retreat signals renewed investor confidence in Lyft's path to profitability.
Investors will look to Q2 guidance and updates on autonomous-vehicle tie-ups when Lyft reports next in late July.
This article first appeared on GuruFocus.