Shares of Lyft soaring nearly 17% higher despite no clear catalyst.
Dan comments on autonomous driving and says he is trying to sift through some of these names.
Dan thinks their balance sheet is okay and went into this as an investment, but says this can turn into a trade.
Dan comments on autonomous driving and says he is trying to sift through some of these names.
Dan thinks their balance sheet is okay and went into this as an investment, but says this can turn into a trade.
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NewsTranscript
00:00 Time for topping the tape.
00:01 Shares of Lyft zooming nearly 17% higher today.
00:05 That's the biggest gain since November 2020.
00:07 The odd thing about today's surge is that
00:09 there doesn't seem to be any real catalyst.
00:11 We didn't see a street upgrade.
00:12 We didn't see any market moving news.
00:14 Worth noting, the stock is still 60% lower this year.
00:19 Tim, you've said before you like Lyft over Uber.
00:22 Here we are.
00:23 Well, I like it on a relative value trade,
00:25 and I've historically liked Uber over Lyft,
00:27 and I'm not just conveniently now flipping
00:29 and said I got this trade totally right.
00:31 I mean, you've lost a lot of money in both stocks,
00:32 but if you look at Uber versus Lyft,
00:34 it's outperformed by 60% in the last six months.
00:37 It's outperformed by 35% in the last three months,
00:39 and some of the updates we've gotten from Lyft lately
00:41 indicate that their third quarter
00:43 is off to a pretty good start.
00:44 You're also seeing a better balance
00:45 and availability on the driver's side,
00:47 although ASPs have fallen.
00:48 Some of their cost base is changing,
00:51 and so this is the dynamic that the street wants to hear.
00:53 I just look at the relative value here.
00:55 I'll tell you what, I would like to own both companies,
00:58 but at this point, owning Lyft to me
00:59 is the better place to be.
01:00 - Dan, you just bought some Lyft.
01:02 - Yeah, I did last week, and here's the thing.
01:06 I agree with everything Tim just said here.
01:08 Another theme out here is autonomous driving, right?
01:11 And Waymo, which is an Alphabet company,
01:14 has a stake in Lyft.
01:15 They have a partnership as they work
01:17 towards autonomous robo-taxis and the like,
01:20 and so what I'm trying to do is sift through
01:22 some of these names right here
01:23 where the baby's been thrown out with the bathwater
01:25 a little bit.
01:26 When I bought this stock last week,
01:28 I mean, they had 50% of their market cap in cash.
01:31 Now, the stock is obviously up 20-some percent
01:33 in that period of time,
01:34 but I think their balance sheet is okay.
01:36 On an adjusted basis, they're making money.
01:38 I know that there's plenty of things
01:39 to kind of shake a stick at
01:41 when you want to talk about a company like this
01:43 as making money on an adjusted basis here,
01:46 but I just think it's a bit washed out here.
01:47 So I went into this as an investment,
01:49 but trust me, people,
01:50 these sorts of things can turn into trades,
01:52 especially if you get big moves this quickly.
01:55 - It just did, so is it?
01:56 - No, I mean, let's see if I get a two-handle on it.
02:01 Here's the deal, Mel.
02:02 You know, they're supposed to have 20% revenue growth
02:05 for the next couple years coming off a very low base.
02:07 I look at a name like this, clearly an acquisition target.
02:10 I know that there's a lot of areas
02:11 where the regulators are not gonna allow acquisitions.
02:14 I don't think this is a space
02:16 where that's gonna be the case.
02:17 Could Waymo buy a company like this in a heartbeat
02:20 for like a $10 billion enterprise value?
02:21 Be a rounding error.