Lyft (NASDAQ:LYFT) was upgraded to Buy at both Gordon Haskett and Bank of America in notes Friday after the company released mid-term guidance on Thursday.
Analysts at Gordon Haskett lifted the stock to Buy from Hold with a $20 per share price target, saying they see the investor skepticism surrounding the company's financial targets as a low-risk, high-reward call option.
"With Lyft’s shares increasing just 1% (S&P 500 flat) on the back of what we expect will be solid upward revisions to consensus estimates, we believe investors are discounting Lyft’s ability to achieve the targets and see the shares offering a low-cost, high reward option," explained the firm.
They add that if Lyft eventually walks down the targets, they think investors will shrug off the news as they didn’t believe the targets to begin with. Alternatively, if Lyft can demonstrate solid top and bottom-line growth over the next few quarters, they expect to see both upward EBITDA revision and multiple expansion.
Meanwhile, Bank of America double-upgraded Lyft to Buy from Underperform, raising the price target to $20 from $15 per share.
The investment bank said the company's investor day, in which it released the mid-term guidance, ups their confidence in the company's long-term trajectory.