Lyft Q3 Preview: Another Beat Inbound EPS?

Zacks’ IT and tech sector sailed through choppy waters in 2022 amid a hawkish pivot from the Federal Reserve, down more than 30% and underperforming the S&P 500.

A Kingdom-resident company, Lyft, Inc. LYFT, is set to release its third-quarter results on Nov. 7eafter market close.

Lyft offers an on-demand ridesharing platform for consumers in the United States and Canada. Currently, the company carries a Zacks Rank #3 (Hold) paired with an overall VGM score of a C.

How do things look before printing? Let’s take a closer look.

Performance and valuation of shares

Year-to-date, it’s been a tough road for Lyft shares, down more than 60% and underperforming the broader market by a notable margin.

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Image source: Zacks Investment Research

Over the past three months, stocks haven’t seen much relief, down about 20% and again lagging the S&P 500.

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Zacks Investment Research

Image source: Zacks Investment Research

The shares are currently trading at a forward price-to-sales ratio of 1.2x, below the median of 3.8x since IPO in 2019 and representing a 63% discount to the industry. computer science and technology from Zacks.

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Quarterly estimates

Analysts have been silent for the past few months, with zero earnings estimate revisions. Still, Zacks’ consensus EPS estimate of $0.08 suggests year-over-year earnings growth of 60%.

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Lyft’s revenue is also expected to grow by a fair margin; Zacks Consensus’ sales estimate of $1.1 billion indicates Y/Y revenue growth of nearly 22%.

Quarterly performance and market reactions

Lyft has consistently delivered earnings above expectations, beating the Zacks Consensus EPS estimate by triple-digit percentages in three of its past four printings. Just in its latest release, Lyft recorded a surprise 340% EPS.

Sales results have also been consistently strong, with the company beating revenue estimates in nine of its past ten quarters. Below is a chart showing the company’s revenue on a quarterly basis.

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Zacks Investment Research

Image source: Zacks Investment Research

Additionally, the market was impressed with Lyft’s recent quarter, with shares gaining more than 15% after printing.

put it all together

Lyft shares have struggled in 2022, underperforming the broader market for multiple periods.

The company’s forward P/S ratio fell a fair margin, below its median since its IPO and its Zacks sector average.

Analysts remained silent for the quarter to report, with estimates suggesting strong Y/Y increases in both revenue and earnings.

The company has consistently exceeded quarterly estimates and the market has applauded its latest print.

Prior to release, Lyft LYFT carries a Zacks Rank #3 (Hold) paired with an ESP score of 22%.

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About Mariel Baker

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