Lyft Stock Picks Up First "Sell" Rating

Seaport Global is skeptical that consumers will abandon cars for ride-sharing

by Patrick Martin

Published on Apr 2, 2019 at 10:12 AM

The run-up to the initial public offering (IPO) of Lyft Inc (NASDAQ:LYFT) was treated with much fanfare. The shares have gotten off to a rocky start, shedding 26% from their March 29 open at $87.24 to yesterday's close at $69.01. Today, LYFT stock hit a record low of $66.10 -- well below its $72 IPO price -- and was last seen down 1.3% to trade at $68.08.

Analysts are starting to chime in on LYFT. The stock received its first ever "sell" rating from Seaport Global earlier, which also set its price target at $42, a steep discount to current levels. The analyst in coverage thinks investors are taking a "big leap of faith" that ride-sharing services will be more appealing than car ownership. Elsewhere, Cross Research initiated coverage with a "buy."

This mixed analyst attention echoes the broader trend seen toward Lyft, with three brokerages rating the stock a tepid "hold," and two rating it a "buy" or better. Meanwhile, the security's consensus 12-month price target of $84 is now a 26% premium to its current perch, making LYFT already susceptible to a shift in analyst sentiment.

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