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Gordon Haskett upgrades Lyft to a buy, says shares can more than double from here

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Gordon Haskett said the 74% pullback in Lyft shares this year creates an enticing entry point for investors looking for a bargain. Analyst Robert Mollins upgraded shares of the ridesharing stock to a buy rating with a $24 price target, noting that Lyft is trading at an attractive discount to Uber and shares can more than double from Tuesday’s close. “While we believe Lyft warrants a lower valuation multiple relative to Uber, the current valuation gap is far too wide,” he wrote in a note to clients Wednesday. Along with the pullback in shares, Mollins highlighted several additional catalysts for the stock going forward, including continued improvement to driver supply — specifically in California. He also expects tailwinds from return-to-office trends. Compared to Lyft, Uber shares have slumped about 41% this year. Gordon Haskett’s price target suggests Lyft’s stock can rally 113% from Tuesday’s close. Both Uber and Lyft traded sharply lower Tuesday after the Biden administration released a proposal that could clear the way for the companies’ drivers being reclassified as employees rather than independent contractors. Many fear the proposal could raise the companies’ costs and reduce the supply of drivers. Lyft said Tuesday the proposal has “no immediate or direct impact” on its business at this time. — CNBC’s Michael Bloom contributed reporting

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