Lyft (LYFT) Valuation in Focus After Waymo Partnership Expands Autonomous Ride-Hailing Ambitions

Lyft (LYFT) is back in the spotlight after announcing a major partnership with Waymo to launch fully autonomous ride-hailing services in Nashville starting in 2026. This collaboration is more than just a tech headline; it is a shift that could change how investors view Lyft’s competitive standing versus rivals, especially as the company deepens its move into autonomous vehicles. By leveraging its own fleet management arm to support Waymo’s vehicles, Lyft stakes a claim in the next phase of ride-hailing innovation, giving investors plenty to consider about the company’s future growth potential and risk profile.

This news has reverberated through the market. While the past year has seen Lyft’s stock surge over 81 percent, outpacing typical returns, the bulk of its momentum has gathered in recent months, with gains of over 51 percent in the past quarter alone. The combination of fresh partnerships and rapid regulatory changes in the rideshare landscape is fueling shifting expectations, though competition from Uber and execution challenges still linger in the background.

After this surge and a headline-grabbing deal, is Lyft stock setting up for another leg higher, or is the market already pricing in all of this potential?

Most Popular Narrative: 24% Overvalued

According to the most widely followed narrative, Lyft currently trades above what analysts consider its fair value. This reflects high expectations for future growth and profitability.

Strategic global and cross-industry partnerships (for example, with United Airlines, Chase, DoorDash) are driving higher-frequency usage and access to premium customers. This increases average revenue per user and provides resilient, recurring transaction growth.

What is fueling this premium valuation? The answer lies in bold growth projections, margin improvements, and future earnings assumptions that set Lyft apart from its peers. Which financial levers do analysts believe will justify such an aggressive future multiple? Explore the full narrative for the numbers that are influencing price targets.

Result: Fair Value of $18.22 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, continued regulatory shifts and aggressive competition from Uber could still upend these optimistic projections. As a result, Lyft’s long-term outlook remains far from certain.

Find out about the key risks to this Lyft narrative.

Another View: SWS DCF Model Signals Undervaluation

Looking through a different lens, our SWS DCF model paints a more optimistic picture. It indicates that Lyft may be undervalued based on long-term cash flow forecasts. Could this signal upside that the market is missing?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Lyft for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Build Your Own Lyft Narrative

If you have a different perspective or want to test your own assumptions, you can easily craft a personal Lyft story guided by the data in just a few minutes. Do it your way

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding Lyft.

Looking for More Smart Investment Ideas?

Now is your chance to spot new trends and promising opportunities beyond Lyft. Uncover the stocks with the greatest upside and stay ahead of the curve by using the tools many investors miss.

• Turbocharge your search for tomorrow's technology leaders with our handpicked AI penny stocks. See which companies could shape the next era of innovation.
• Catch high potential value opportunities early by using our tailored screen for undervalued stocks based on cash flows. Uncover overlooked gems that meet strict cash flow criteria.
• Capitalize on cash returns by scanning for top dividend stocks with yields > 3%. Pick out resilient companies offering reliable yields over 3 percent.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com