Ride-hailing company Lyft (NASDAQ: $LYFT) is a small-cap stock that looks dirt cheap at current levels.
The San Fracisco-based company is the second-largest ridesharing company in the U.S. and Canada after rival Uber Technologies (NYSE: $UBER).
Lyft, which also operates in Europe, has 25 million active riders and coordinates nine million rides per day. The company has 4,000 employees and generates $6 billion U.S. in annual revenue.
Despite its success, LYFT stock has been punished, falling 70% in the last five years, including an 18% decline this year.
The selloff has made LYFT stock extremely cheap. The company’s shares are currently trading at $16 U.S., giving it a rock bottom price-to-earnings ratio of 2.31.
Lyft currently has a market capitalization of $6.11 billion U.S., placing it in the small-cap category that’s reserved for equities valued at less than $10 billion U.S.
Analysts blame Lyft’s struggles largely on the fact that it does not have its own consumer-facing food delivery app or marketplace, ceding ground to competitors such as Uber Eats.
However, this is not to say that Lyft is not diversifying its business. The company is expanding beyond ridesharing to offer e-scooters and bicycle-sharing across the U.S. and Canada.
There’s no dividend provided on Lyft’s stock. But there are signs of improvement with the share price rising 13% over the past month and coming off a 52-week low of $12.46 U.S.
And the company could eventually enter the food delivery space, potentially through an acquisition.
Regardless, Lyft is a small-cap stock that might be too cheap to ignore.
