RBC Capital sees quarterly driver supply data as positive for rideshare names

RBC Capital analyst Brad Erickson keeps a Sector Perform rating with a $12 price target on Lyft (LYFT) and also keeps an Outperform rating with $58 price target on Uber (UBER) but notes that the firm’s quarterly driver supply analysis yielded a generally positive takeaway for the ridesharing space. Uber is maintainig a structural advantage, though the firm remains encouraged at observing Lyft being price competitive with likely low risk to rising driver incentive intensity, the analyst tells investors in a research note. The rising frequency driving underappreciated Mobility & Delivery growth at Uber, where long-term targets likely need only be achieved, and at 17-times enterprise value to expected FY24 buy-side EBITDA estimates, Uber shares look “attractive”, RBC states. The firm adds that it is more cautious on Lyft as its ability to improve its scale disadvantage may be limited and insurance in particular could pose annual risk to Q4 estimates given the annual October renewal.