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Analyst slaps $42 target on Lyft — 42% below its IPO price — says buying it is a 'leap of faith'

Lee239

Well-Known Member

jaxbeachrides

Well-Known Member
It doesnt matter if people have cars or not. It matters how much you charge for your service and how much money you have leftover at the end of the day.
 

jaxbeachrides

Well-Known Member
This is different because you have 2 companies doing the exact same thing.

There are not 2 amazons. Theres not 2 apple incs.

The only solution these companies have had is to repeatedly cut price to gain market share, with no meaningful improvement in quality of service or proprietary intellectual property development.

This is just a race to lose money. A race to the bottom.
 

TwoFiddyMile

Well-Known Member
This is different because you have 2 companies doing the exact same thing.

There are not 2 amazons. Theres not 2 apple incs.

The only solution these companies have had is to repeatedly cut price to gain market share, with no meaningful improvement in quality of service or proprietary intellectual property development.

This is just a race to lose money. A race to the bottom.
Way more than two companies. The rest have mostly failed (A.K.A. ran out of capital).
 

Lee239

Well-Known Member
  • Thread Starter Thread Starter
  • #7
The real question investors should be asking is why can't Uber and Lyft make money when they use your labor your gas and your car and take 25% minimum of each ride, including the first $2 to $3 or each ride plus all the extra money that they over charge the customer. Basically they run and app, make you do the work and spend your money and can't make a profit. It makes no sense. Oh and the drivers are miserable.
 
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TwoFiddyMile

Well-Known Member
The real question is why can't Uber and Lyft make money when they use your labor your gas and your car and take 25% minimum of each ride, including the first $2 to $3 or each ride plus all the extra money that they over charge the customer. Basically they run and app, make you do the work and spend your money and can't make a profit. It makes no sense. Oh and the drivers are miserable.
Do your research. The answer is all over this forum. I've explained time and time again.
 

Woohaa

Well-Known Member
The real question investors should be asking is why can't Uber and Lyft make money when they use your labor your gas and your car and take 25% minimum of each ride, including the first $2 to $3 or each ride plus all the extra money that they over charge the customer. Basically they run and app, make you do the work and spend your money and can't make a profit. It makes no sense. Oh and the drivers are miserable.
^^^^^^^^ This.

All day. Everyday.
 

The Gift of Fish

Well-Known Member
The real question investors should be asking is why can't Uber and Lyft make money when they use your labor your gas and your car and take 25% minimum of each ride, including the first $2 to $3 or each ride plus all the extra money that they over charge the customer. Basically they run and app, make you do the work and spend your money and can't make a profit. It makes no sense. Oh and the drivers are miserable.
According to Lyft's IPO disclosures, they spend very heavily on advertising and on insurance. Have you seen how Lyft drivers drive? Employee costs (not us) are also high.
 

ftupelo

Well-Known Member
https://www.cnbc.com/2019/04/02/lyft-shares-fall-again-as-analyst-says-buying-the-ipo-here-is-leap-of-faith.html

  • Seaport Global Securities analyst Michael Ward initiates coverage of the stock with a sell rating and a 12-month price target of $42 a share.
  • "In order to justify its current market valuation, investors need to take a big leap of faith that the millennials and later generations will forego ownership of a car and opt instead for reliance on a ridesharing service," he says.
I disagree with his analysis. It's not about whether folks will forgo car ownership, it is about WHEN they do forgo car ownership, will Lyft be the platform they turn to to provide for their mobility needs. Do they turn to UBER instead? Does Google/Waymo launch a ride-share service? Do any or all of the car manufacturers create their own platform?

It's really a story about what role Lyft will play in the self-driving future and what niche they can carve out of that future.
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The real question investors should be asking is why can't Uber and Lyft make money when they use your labor your gas and your car and take 25% minimum of each ride, including the first $2 to $3 or each ride plus all the extra money that they over charge the customer. Basically they run and app, make you do the work and spend your money and can't make a profit. It makes no sense. Oh and the drivers are miserable.
What percent of companies with 25% gross margins do turn a profit?
 

Lee239

Well-Known Member
  • Thread Starter Thread Starter
  • #15
I disagree with his analysis. It's not about whether folks will forgo car ownership, it is about WHEN they do forgo car ownership, will Lyft be the platform they turn to to provide for their mobility needs. Do they turn to UBER instead? Does Google/Waymo launch a ride-share service? Do any or all of the car manufacturers create their own platform?

It's really a story about what role Lyft will play in the self-driving future and what niche they can carve out of that future.
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What percent of companies with 25% gross margins do turn a profit?
Walmart.
Walmart Inc Gross Profit Margin (Quarterly):
24.41% for Jan. 31, 2019






Plus Uber and Lyft don't have expenses like other companies do they are paying you for you to use your car, labor and gas.
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According to Lyft's IPO disclosures, they spend very heavily on advertising and on insurance. Have you seen how Lyft drivers drive? Employee costs (not us) are also high.
They may spend a lot of insurance in total but I doubt that even the first dollar they take from each ride goes to each ride doesn't cover insurance plus profit. If you do 30 rides that would be $30 a day to pay for insurance, insurance costs less than that and a vast majority of drivers do not use the insurance and it's flaky too.
 

mbd

Well-Known Member
I disagree with his analysis. It's not about whether folks will forgo car ownership, it is about WHEN they do forgo car ownership, will Lyft be the platform they turn to to provide for their mobility needs. Do they turn to UBER instead? Does Google/Waymo launch a ride-share service? Do any or all of the car manufacturers create their own platform?

It's really a story about what role Lyft will play in the self-driving future and what niche they can carve out of that future.
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What percent of companies with 25% gross margins do turn a profit?
Lyft loses 1.50 a ride, and part of it was
Giving out rides for loss.... they can chop off at least 1.00 out of the 1.50 by
Cutting down on advertising, research on autonomous vehicles and no more free rides.
Goog and gm both investors in Lyft, and Goog has Waymo, so why bother spending $$$$ on autonomous research ... I think Goog will partner with Lyft if autonomous vehicles actually make it to the roads ( I don't think it will in a mass scale), and gm also trying out AV.. Lyft brand has grown enough, they can cut down on advertising...
 

tohunt4me

Well-Known Member
https://www.cnbc.com/2019/04/02/lyft-shares-fall-again-as-analyst-says-buying-the-ipo-here-is-leap-of-faith.html

  • Seaport Global Securities analyst Michael Ward initiates coverage of the stock with a sell rating and a 12-month price target of $42 a share.
  • "In order to justify its current market valuation, investors need to take a big leap of faith that the millennials and later generations will forego ownership of a car and opt instead for reliance on a ridesharing service," he says.
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A
This is different because you have 2 companies doing the exact same thing.

There are not 2 amazons. Theres not 2 apple incs.

The only solution these companies have had is to repeatedly cut price to gain market share, with no meaningful improvement in quality of service or proprietary intellectual property development.

This is just a race to lose money. A race to the bottom.
And NOW
THEY DRAG INVESTORS WITH THEM !

Sounds like a Giant Toilet Flushing . . .

All of that Money

Going AWAY . . . . .
 

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ftupelo

Well-Known Member
@Lee239 I'm not saying it is impossible to turn an operating profit with 25% gross margins, but 25% is certainly skinny. The exact question was what percent of companies with 25% gross margins turn a profit? It's actually an interesting question that I wish I had the answer to. 25% EBITDA margins would be fine, but certainly not gross margins.
 

tohunt4me

Well-Known Member
@Lee239 I'm not saying it is impossible to turn an operating profit with 25% gross margins, but 25% is certainly skinny. The exact question was what percent of companies with 25% gross margins turn a profit? It's actually an interesting question that I wish I had the answer to. 25% EBITDA margins would be fine, but certainly not gross margins.
Lyft does NOT have the Volume.

Perhaps Uber does ?
 

heynow321

Well-Known Member
I disagree with his analysis. It's not about whether folks will forgo car ownership, it is about WHEN they do forgo car ownership, will Lyft be the platform they turn to to provide for their mobility needs. Do they turn to UBER instead? Does Google/Waymo launch a ride-share service? Do any or all of the car manufacturers create their own platform?

It's really a story about what role Lyft will play in the self-driving future and what niche they can carve out of that future.
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What percent of companies with 25% gross margins do turn a profit?
People will never give up their cars. What a stupid idea
 

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