Lyft falls further from the IPO after receiving the first "sale" rating

SAN FRANCISCO (Reuters) – Lyft Inc. shares fell below the price of its IPO after being criticized for the first time by a skeptical analyst about the possibility of consumers giving up their cars for services troubleshooting.

Shares of the loss-making company, San Francisco, lost up to 4.2% to $ 66.10 on Tuesday, their second straight loss after a much-anticipated public offering of $ 72 Friday. The stock was down 2.3% to $ 67.41 early Tuesday afternoon on the Nasdaq.

The weak performance of the stock could make investors more cautious about a series of public announcements expected of Silicon Valley unicorns, including Uber Technologies Inc. and Pinterest, which are also unprofitable.

Seaport Global began Lyft's hedge with a "sell" rating and price target of $ 42, analyst Michael Ward calling the current valuation a "deed of confidence" that consumers will forego car ownership in favor of relay services.

"Although vehicle optics is an underutilized asset, we believe that people will continue to use their own vehicles as the primary means of transportation and that they will instead use car pooling services as a practical supplement." , writes Ward in a note to the client.

Five other analysts started Lyft's coverage, two of them recommending the title and three assigning neutral ratings.

These five analysts expect on average that Lyft's revenues will increase by 60%, reaching $ 3.45 billion in 2019, while those of Ward for 2019 would reach $ 3.40 billion.

Lyft reported a loss of $ 911 million in 2018, a loss greater than that of $ 688 million in 2017, despite revenues doubling in 2018 to $ 2.16 billion. He did not say when he hopes to become profitable.

The stock, which climbed to $ 88.60 a few minutes after trading on Friday before falling steadily, is now trading at about 5.7 times the expected annual business figure. By way of comparison, Alphabet Inc.'s shares currently represent 4.8 times expected revenues, while Facebook Inc. represents 6.5 times the expected revenues.