Is Lyft Still a Ride Worth Taking After Its 45% Surge in 2025?

• Wondering if Lyft at around $19.86 is still a ride worth taking, or if the easy money has already been made? This breakdown will help you decide whether the current price offers real value or just noise.
• Despite a bumpy recent ride, with the stock down about 2.5% over the last week and 6.4% over the last month, Lyft is still up 45.5% year to date and 46.4% over the past year, even after a 59.4% drop over five years.
• Recent headlines have focused on Lyft sharpening its focus on core ride sharing operations and improving cost discipline, which has helped shift sentiment toward the idea that the business model is becoming more sustainable. There has also been growing attention on how regulatory developments and competitive dynamics with Uber could reshape the long term economics of the sector.
• On our framework, Lyft scores a 4 out of 6 valuation score, suggesting it looks undervalued on several fronts. Next, we will unpack the different valuation methods behind that number and point to an additional way to judge what the stock might be worth by the end of this article.

Lyft delivered 46.4% returns over the last year. See how this stacks up to the rest of the Transportation industry.

Approach 1: Lyft Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow, or DCF, model estimates what a company is worth today by projecting the cash it can generate in the future and then discounting those cash flows back to their value in todays dollars.

For Lyft, the model uses a 2 Stage Free Cash Flow to Equity approach, starting from last twelve months free cash flow of about $958.6 million and projecting how that grows over time. Analyst forecasts are used for the next few years, with Simply Wall St extrapolating further out. By 2028, free cash flow is expected to be around $1.30 billion. The ten year projection path continues to edge higher in later years as growth moderates.

When all those future $ cash flows are discounted back, the model arrives at an intrinsic value of roughly $55.90 per share. Compared with the current share price around $19.86, the DCF implies the stock is about 64.5% undervalued, which indicates a wide margin of safety if the cash flow assumptions prove broadly accurate.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests Lyft is undervalued by 64.5%. Track this in your watchlist or portfolio, or discover 916 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Lyft.

Approach 2: Lyft Price vs Earnings

For profitable companies like Lyft, the price to earnings ratio is often the cleanest way to gauge how much investors are willing to pay for each dollar of profit. In general, faster earnings growth and lower perceived risk justify a higher PE, while slower growth or higher uncertainty argue for a lower, more conservative multiple.

Lyft currently trades on a PE of about 52.63x, which is well above the Transportation industry average of roughly 31.35x and also a bit below the broader peer group at around 55.24x. On the surface, that premium to the industry suggests the market is already baking in strong growth and improving profitability.

Simply Wall St also calculates a Fair Ratio for Lyft of 20.93x, which is the PE we would expect given its specific mix of earnings growth, margins, industry, market cap and risk profile. This tailored benchmark is more informative than a simple comparison with peers or industry averages because it adjusts for Lyft’s own fundamentals rather than relying on broad groupings. Since the current PE of 52.63x is meaningfully higher than the Fair Ratio of 20.93x, the multiple implies the stock is trading at a premium to what its fundamentals alone would warrant.

Result: OVERVALUED

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Upgrade Your Decision Making: Choose your Lyft Narrative

Earlier we mentioned that there is an even better way to understand valuation. Let us introduce you to Narratives, an easy tool on Simply Wall St’s Community page that lets you turn your view of Lyft into a simple story linked directly to numbers such as future revenue, earnings and margins, and then to a Fair Value you can compare with today’s price to help inform your decision. The platform keeps that Narrative updated as news and earnings arrive. For example, one investor might build a bullish Lyft Narrative around autonomous rollout, global partnerships and margin expansion that supports a Fair Value closer to the high end of analyst targets near $28. A more cautious investor could instead emphasize competitive pressure, regulatory risk and slower profitability to anchor their Narrative nearer the low end around $10. Both perspectives are clearly quantified instead of being just vague opinions.

Do you think there's more to the story for Lyft? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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