Lyft's business turned a profit on an adjusted basis in the second quarter, Uber's didn't. Lyft sees more profits ahead as people turn more mobile after getting a COVID-19 vaccine, Uber's business outlook is a bit cloudier given its complexity.
That comparison right there explains why Lyft (LYFT) is a better play on the pandemic recovery than Uber, thinks Lyft's long-time CFO Brian Roberts.
"The companies are really two different companies. We actually love that. I mean we are competing against this conglomerate and if you want to invest in freight, you have a choice. We are this pure play around transportation," said Roberts on Yahoo Finance Live.
Added Roberts, "There are a lot of investors who are excited about this ability to just invest in transportation and not worry about all of this food competition, lots of different players, aggressive companies out there on freight or all these other things."
Despite a pickup in driver incentives, Lyft was able to achieve adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) profitability for the first time in the second quarter. The company guided to third quarter adjusted EBITDA of $25 million to $35 million.
Meanwhile, Uber lost $509 million on an adjusted EBITDA basis in the second quarter. Executives told analysts on an earnings call they are "committed" to reaching profitability this year.
Jefferies analyst Brent Thill sees Lyft as an attractive re-opening play, in large part because of the pure play business model referenced by Roberts.
"Lyft is well positioned to benefit in coming quarters as a pure-play story on U.S. ride-hailing. Current valuation 3.9x CY22 enterprise value/sales remains attractive vs. marketplace peer median 3.8x and broader comparable group median 5.8x," Thill said in a research note to clients.