The Lyft Share price jumped 6% in after-hours trading as the ride-sharing Uber rival reported a 7% increase in revenue for the first quarter.
In what was a difficult day for growth stocks, the Lyft share price bucked the trend after the company revealed better-than-expected earnings for Q1 2021.
The Lyft share price last traded higher by +$3.31 at $59.50 and an increase of +5.89% from the $56.19 closing price.
Loss per share -$0.35 vs. expected -$0.53
Revenue $609 Million vs. $558.70 Million
As well as beating the street’s top and bottom-line estimates, the company revealed that its active user base increased from 12.8 Million to 13.49 in the first three months of the year. Even more promising was the news that revenue per active rider increased to $45.13 vs. $44.50
After a torrid 2020, the outlook for the Lyft share price is starting to look a little rosier. Speaking on the earnings call, CEO Logan Green lifted guidance for Q2 2021 and expects revenue to increase to around $700 Million for the period, saying:
“We continue to believe there is still significant pent-up demand for mobility that will take time to play out,”
This puts Lyft on track to bring forward its timeline for profitability to Q3 2021 from Q4.
In what should provide a further boost for the Lyft share price, President Biden, last night, set a new goal to have 70% of the U.S adult population receiving at least one covid-19 vaccination jab by July 4th’s independence day.
Lyft Technical Outlook
If we look at the daily price chart for Lyft, we can see that the market had broken down out of a descending price channel over the last four trading sessions.
The move to yesterday’s low of $53.48 saw the Lyft share price almost 5% below the important 100-Day Moving Average level of $56.03
The market recovered sharply from the intra-day low to finish the session back up above the important gauge of sentiment in what looked like a classic bear trap.
This turnaround in price has triggered the formation of a bullish hammer candle on the chart. This candle shows the price made a new formation low, then reversed to close towards the top of the day’s trading range. Technical analysts view this price action as bullish, often preceding a reversal in trend.
The overnight move sees the Lyft share price climb back above a descending trend line in place from the March 10th low of $61.10. Having cleared this resistance level convincingly, the next logical target would be the 50-Day Moving average at $61.92 and a trend line in place from the 15th of March high at $64.98.
Whilst we are bullish on the Lyft share price, we can’t discount a sell-off should yesterday’s broader tech stock route continue. Below the market, we see support at the 50-Day MA and beyond that the 13th of January’s $51.24 high. A failure to hold these support levels would invalidate the bullish call in the short term.