A sign marks a meeting place for Lyft and Uber users at San Diego State University in San Diego, California, on May 13, 2020.
Mike Blake | Reuters
Shares of Lyft jumped as much as 11% on Wednesday as investors concentrated around the company after saying it saw a recovery in shares sooner than expected.
Lyft’s recovery also brought optimism to Uber shares, which rose to 5.8% on Tuesday on a weak day for tech stocks. It comes despite cautious comments from CEO Dara Khosrowshahi on Monday at the Morgan Stanley Tech conference, saying she expects her mobility business to see some signs of recovery in the US and Europe, although it is “too early to tell. ho “.
Lyft now expects to manage its first-quarter adjusted EBITDA loss of $ 135 million, from $ 145 million to the $ 150 million previously forecast, according to a Tuesday filed with the SEC. The company also said the last week of February was its best week in terms of volume since the pandemic closures began in March 2020 and expects the recovery to continue this month.
The company’s growing recovery comes as more states begin lifting Covid-19 restrictions and vaccines continue to roll out across the country.
“We believe that LYFT is about to show a turn towards positive year-on-year growth from the week of March 21, which we believe will accelerate until the summer months without any setbacks with the deployment of vaccines. We see the outlook for the first quarter of LYFT as a positive fact, especially given the still uncertain landscape of the pandemic and weather problems in certain regions, “according to CFRA analysts on Wednesday.
Truist analysts said Tuesday that the company’s update on business trends gives the company “increased confidence that business trends should continue to improve as local governments ease restrictions on social activities and people get back to work with the C-19 gradually dwindling. “
“We believe the reduction in restrictions, especially in Texas, which has been completely reopened, could accelerate the improvement in Y / Y trends during the spring,” they added.
Uber and Lyft have still maintained optimism and will be profitable later this year on an adjusted EBITDA basis.
“Right now, LYFT sees encouraging signs of demand and has been able to manage that demand as it leads to better profitability while showing solid execution,” Needham analysts wrote in a note to clients on Wednesday.
– CNBC’s Michael Bloom contributed the notification.
Subscribe to CNBC on YouTube.