Lyft overvalued here, according to the dean of valuation, Aswath Damodaran
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- Опубліковано 4 лют 2025
- What's Lyft really worth? Aswath Damodaran, NYU Stern School of Business, says the company is overvalued. With CNBC's Melissa Lee and the Fast Money traders, Pete Najarian, Tim Seymour, Karen Finerman and Dan Nathan.
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Finally a humble knowledge guy good job CNBC
Professor Damodaran has his own youtube channel. Everytime I watch his videos I feel like a student in his class. He's very insightful, you'll always learn something new from him.
travelinghd thanks for letting us know about this. Just checked out his channel and he's only getting a few hundred views. Criminally underrated, hope that changes soon
@@UndergroundTech the best things on UA-cam usually have the fewest views. Quality over quantity.
Thanks for letting me know that he has a UA-cam channel, he's the best at valuation and with his videos i will learn from him without going to NYU.
@@Avocadosimp you're welcome Investors Archive is another good channel as well.
thank you, for sharing about his channel
Very good ideas from this professor. Finally some sense on CNBC.
Professor Damodaran is too smart for the room
Smartest guy in the room isn't wearing a suit and tie.
because he knows he is ahead of the others, so he doesnt need to impress with outer attire
@@aravinnnn Thanks for letting me know.
@@finsimple4396 anytime brother
This is so to the point. I keep telling people we have like 5 apps/services no worse than lyft or uber here in my town of 200k in europe. Valuating an app at lyft or uber valuation is .com bubble all over again
Tell that to Google and Amazon.
Refreshing to hear somebody on CNBC talking calmly, methodically and not shouting (as opposed to manically and loudly)
Finally some sensible talk on this show. Thanks professor
There is no "Stickiness" in the business, both to customer and driver, nuff well said!
People have to realize that nowadays IPO is an exit plan for the investors in startups; Thus, they will try to bloat the numbers until certain period and cash out. That's why you see alot of startup IPOs fly so high during the 1st 48 hours and decline like crazy on the next 48 hours.
This is so true, except for uber. I laughed so hard when Uber's opening price on nyse was below its IPO price, it almost never happens. The insiders and people with connections got a worse deal than the public did lol.
There is a lock out period though?
I feel like...I got my MBA at NYU less than 5 mins
Prof hits the nail on the head! @CNBC --- Please bring him on more!!
He said it all when he said there is no sticky-ness with Uber or Lyft in terms of keeping their customers or drivers and if there was a third option most will go to that too! For that reason alone it should be enough to stay away from Lyft and Uber when it goes public!
Within 10 years there won't be a need for drivers
For tht reason I’m out
@@howo357 and within 10 years they don't need customers too
@@howo357 you're stupid if you think autonomous vehicles will reign the streets within 10 years.
@@skylander5116 do you wanna bet?
Great point. Uber and Lyft don't own anything. Uber talking about autonomous vehicles in their valuation is nonsensical unless they manufacture cars themselves. Why would a car manufacturing company need them if they don't own drivers or riders? Also, how many times would people need Uber if they have a self driving car? Once the Uber Driver model breaks down, Uber Eats will go south too...
Makes sense
Damodaran the Almighty speaks and makes Lyft's stock price low.
Damodaran actually means "the almighty" 😀
@@PunitSoni00 Ha, really? His family was destined for something special. Thanks!
hahahah man I love seeing this guy talk about his rule. People just don't understand that this guy is all about reality and not pretend money!
Aswath is the best
Very smart guy. Respect.
Nice video I so much love it...... most people remain poor only because friends and relatives discouraged and advised them against investing and trading forex while the wise ones kept investing and going higher financially
Successful people don't become that way overnight. What most people see at a glance-wealth, a great career, purpose-is the result of hard work and hustle over time. I pray that anyone who reads this will be successful in life..
Cryptocurrency is bringing different revolution in the world economy. Depending on one stream of income had never made any millionaire and earning check's don't put you on Forbes.
Investing in B it c oin has become my family major source of income. My family is fully invested in it not minding the crash our account manager still makes us profit constantly
Assets that can make you rich are Stocks,Bitcoin and Real estate investment but Bitcoin is most profitable.
@@danieljack5667 Do you trade Bitcoin? I mean, how does this bitcoin of a stuff works, I will love to invest on it too...
His "stickiness" analogy is excellent. Uber and Lyft don't have any. They don't own the cars, their drivers, or their customers. And to introduce a sufficiently large-enough fleet of self-driving cars will require that they do what Tesla has had to do... invest tens of billions, learn how to build cars, and understand in great detail, some of the most sophisticated technologies man has ever invented. When Tesla enters the ride-share industry, they WILL have this "stickiness" - they own the harware, the software and do not need to split revenues with any third party. Also, they can (through software) "lock-out" the Ubers and the Lyfts from trying to leverage Teslas for their own fleet(s).
Now... think of the customer - and what he is saying about "loyalty"... I have Lyft, Uber and Tesla ride share apps on my phone. I call them all up. Uber @ $1.50 a mile, Lyft @ $1.45 a mile, Tesla @ $0.90 a mile... It's as he says... customers will go for the most affordable and practical.
Love to see My favourite finance professor spread the knowledge 🔥
You sir are an absolute genius. Right in the money with your points about Lyft having the "1st to IPO" advantage here and for acknowledging the fact that Lyft (and Uber) do not (as yet) have a clear path to profitability with their core mobility service.
Rahul Mathur he is right in terms of Peers analysis, Lyft will be used to value US business of the Uber, however can you properly value the international business they got? If I would bet, it would be betting on Uber to grow more. In most countries Uber is in, it’s an non-alternative choice, it’s the only major player in taxi or food delivery. Don’t get blind, Uber owns Careem in Middle-East and Africa since last few weeks, it has partnership with Yandex in Post-Soviet countries, etc. They’re already an oligopoly.
@@akonvano- Uber might appeal to a different class of investor who seeks exposure to the international mobility market.
IMO, Uber is not "mobility", but virtue of Didi Chuxing & Grab, it owns part of an "Ecosystem too" - honestly, cannot compare Uber w/ Lyft but people will.
I'm not sure where you've got this notion Uber doesn't face competition in major markets - it's been slogged in India (duking it out in SE Asia w/ Go-Jek and Didi is getting slapped in China by the Govt).
Also, becoming an oligopoly isn't good in most countries - the slightest whiff of lack of competition will swing the regulator in with price controls.
This man is a legend...
No mention of autonomous vehicle ambitions. Likely the only way to profitability
I love this guy.never took a class in economics or finance.i love learning from him
The light of the tunnel for Uber and Lyft is self driving.
U just nailed it on the head
nope. the car companies (TSLA or whoever) can easily create their own ride services. Theres no path to profit for either of these companies. LYFT ipo was a pump and dump, and if I were ceo I would have done the same thing.
Globo_Homo_ Beto yes but not everyone can create self driving vehicle. As of right now google has the lead with waymo and they can create a ride sharing app. Waymo is also not a car manufacturer, rather they partnered with one. Some tech companies have the software where a lot of traditional manufacturers are lagging. Even right now, in self driving performance, waymo is the leader in self driving over Tesla, gm and any other car manufacturer
Tesla
People can buy their own self driving cars. But where will they keep the cars ? Who will service them ? who will monitor all the vehicles software ? Where will they charge and the cost ? Risks of law suits for accidents , customer dissatisfaction etc Self driving will just send them further into losses as their costs increase . Investors are being led into a pit
Dean of Valation?? *Valuation*
LoanOrCredit these people don’t know anything
One good take away : Don't try to be everything to all kinds of people
Here’s another possibility: Google’s Waymo software gets installed in most/all new cars in the near future and self-drives all of those cars. So long as Google is controlling all of the cars on all of the roads, they create their own app to sell rides in cars of owners who’ve agreed to it. Google will take 30%-40% and the owner will take 60-70%. Trip prices go down 70% and trip costs go down 90%. Cost of car ownership tumbles although at that point, far fewer people would need to own a car anyway. Not worth it when on-demand rides are cheap enough to take whenever you feel like it. Needless to say, Google would own the market. Tesla would do something similar and be the Apple-like luxury or alternative option in the space. A duopoly. American car manufacturers probably lack both the management prowess and engineering talent (of any kind)needed to compete with Google or Tesla. Uber and Lyft would be toast. Google would just copy or independently figure out Uber or Lyft’s matching system and app. Of course, Google’s dominance would only last until cars themselves become fully autonomous business entities. That is to say, cars will eventually not merely drive themselves, but they will own themselves and manage their own finances, charging riders enough to cover gas, maintenance, and insurance. The car seller would get paid back over time by the actual car itself while riders would get the cheapest and best ride services imaginable. As others have said, 86ing the human driver is key to any of these businesses. The question is, though, who will come out on top once that happens?
joefunk76 good shit
This is a very realistic scenario. Autonomous is the future, and it’s a two horse race at this point (Waymo and Tesla).
3:00 how on earth do you call a loss making business a “good business”. Ffs - it’s total madness!
most young growth company always start with losseas
Rocking a flannel like a boss
We all know the endgame for Lyft is like $5 a share...let’s be real.
I go to the same gas station all the time because of the points. Uber can have a loyalty program too
But would that be profitable?
3 years later Lyft is still at 35 $
The business model is built on people aren't rich anymore.
Uber and Lyft are dying businesses, the drivers are quitting in the bulk, the business is just not going to withold.
I drove for both Uber and Lyft. It was depressing
CNBC should invite Mr Charlie Munger and see how he reacts to this non cash flow producing companies
It's not about being less ambitious as he mentions towards the end but it's about knowing what your strengths are and focussing on those (call it specialisation or finding your unique selling point IMO).
Lyft's stock has decreased by 80% since the publication of this video. He really earned his title.
What's are 501s ?
The guy at the end mentioned a CEO premium like that would be a good thing for Lyft. From a true valuation perspective, that would only be inflating the multiple without any direct correlation to future cash flows. Can be a good thing for speculators who LUCKILY end up on the right side of trades. Not a good thing for investors. Just look at Tesla.
Ty John Elon musk is worth $100 per share
the real question is if you had $25 billion, would you buy lyft?.
Vincent Angel nope..i would just pump bitcone and short banks.
Hell no
I would invest but blockbuster
Good question....
Of course extrapolate to Uber. It’s ridiculous for loss making businesses to be valued so high.
What is his opinion on Ola ?
Ola's starting to take a different approach - electric fleet vehicles - vehicle ownership & standardization to drive down core operating expenses in a hope of reaching profitability. Hence, they partnered with Hyundai & Kia motors ($300M).
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Will never post a profit? Zero value.
Brilliant guy
I wish Aswath would go on Squawk box just to highlight at its highest form, that Joe just likes to hear himself talk and has no clue.
Levi’s have gone way down in quality.
I think Levi's management is simply diluting it's holding same way as VF doing with its jeanswear bucket. These denim brands may stay but as the margin is squeezed the ownership will change hand frequently!
Anyone noticed the spelling mistake?
So the "Dean of Evaluation" is a Professor at NYU and not a hedge fund billionaire?
Lyft is worth no more than $5 per share
And that's being generous for a company that will never make a profit. That's like putting a $5 value on a hole in your pocket.
Which one of his book do you recommend for a investment noobie?
SurferHawa His college textbooks on corporate finance and valuation are great. He also has some amazing free lectures on UA-cam. Highly recommended.
Thank you!!!
If he say so, then it's overvalued
"The business model is broken." Death sentence right there.
IPO = legalized retail dump. Always overpriced to fork retail investor money over to initial private investors who are already loaded.
Experts always say, if you’re a retail investor, stay away from IPOs. If people buy, they have been warned. No sympathy from me.
The Saudi owns Uber, owns Grab, owns Careem, owns Didi through Softbank. So to sum up, I want the EU, the US to sue Softbank over anti-trust and monopoly. They are the one behind all of the merger acquisition, sales of stakes among ride hailing service firms.
3:10 Hotly Anticipated IPOS
WeWork: Hold my beer.
Uber told people they would have self driving cars . That was the hype. They dont have self driving cars. Now what?
Spot on.
Aswath is 63 years old! He looks 43
True
"these are not new kids on the block though.. Lyft" what is she thinking?
So a company lost $1 billion the previous year. And their value is $59/Share?
And here to talk about Lyft is M Night Shyamalan.
Man did he ever call it !!!
I can’t buy enough PUTS on LYFT!
stick to the leader... nice show cnbc.
Waymo(google) self-driving software + 63,000 Chrysler pacific hybrid = uber/left death
Google an apple control the distribution of uber/Lyft app on their app stores. At the complete mercy of these two companies. And they are also developing their own self driving. Uber Lyft can never succeed
I can't wait until they roll them shits through the hood. Uber/Lyfts roll in and never roll out. Who's going to keep people from stealing and stripping them?
To me, until driverless car technology becomes available, these apps, from lyft to uber, are basically worthless...
Kah Hoe Ng worthless from a consumer or investor perspective?
@@tyjohn4779 investor...
Kah Hoe Ng I see
Driverless won’t become available soon, it would still be an experience with human driver holding the wheel and sitting in the chair.
0:13 Dean of "Valation" on IPOs :)
lionel tidjon lol this is CNBC an authority on nothing
What do these companies spend their money on? They make revenue, they do not buy the cars or maintain them. So what are their largest expenses?
I try both and take whichever is cheaper. Like all of us
Why isn't no one talking about Palantir?
Hello 👋 Hiram's Granddaughter.
LEVI STRAUS was near $90.oo an used pair, I think, during The Cold War. Have fun 👍 Moore is less?
levi strauss is at 17 per share today, he said 28....hmm
Its worth $0
Netflix is riding on The Office and Parks and Rec. If they lose them, Netflix will be in trouble real fast
Would never invest a penny in Levi’s
Love to watch your videos ,If there is one thing I have learned in recent months it is to remain calm, especially when it comes to investments in cryptocurrencies. Learn not to sell in a panic when everything goes down and not to buy in euphoria when everything goes up. I advise y'all to forget predictions and start making a good profit now because future valuations are all speculations and guesses.The market is very unstable and you can not tell if it's going bearish or bullish.While myself and others are trad! N without fear of making a loss others are being patient for the price to skyrocket. It all depends on the pattern you follow...
learning:
I stop using automated bots to trader after my 2 months of some pretty intensive trading with Jackson
New era ....new tech bubble....fin tech is going into the same tunnel....
Indians are so smart
You don't say :)
Thy should do a monthly subscription service of like 5$ and you get like a fast pass...
Dean of Valation??? Come on CNBC
They will make money when the autonomous cars come out....!
For a dean of valuation, I can't believe he spoke about valuation in absolute figures and per share prices. How about you tell us the metrics used and what the right metrics and range are? He got no idea how to value a loss making tech company, ask him to do the same for Amazon 10 years back and he'd say the same shit.
Do you have any idea who you are talking about? This man knows more about valuation than anyone you have ever heard of. Ask any ivy league student or leader in the industry.
Brijesh Shukla He needed to clarify his calculations any way. Damodaran is a legend, but he spoke like a student. They asked him how he performed his valuation and he only mumbled.
Watch Levi go to 26 and drop again
Lyft copied Uber: business plan, marketing, strategy....they are not original. Lyft $8 per share Target price. Anyone can copy.
without trying to be an a**h*le, if i may put a guess number here, the right price to pay for uber share is around 70 USD if lyft as comparison
Humans are the problem with these business models. Get rid of the human drivers and you clean up your margins and lower consumer price.
Lol
Are you kidding? They can't make money now, while the vehicles are owned, fueled and maintained by their "human" drivers. How will they afforded an enormous fleet, plus fuel and maintenance. Not to mention the cost of the onboard driverless technology. Who's going to pay for the security of this fleet? People will trash these so called driverless cars. Wake up! These companies are scams.
I think all companies are overvalued
So true.
They know noting. leave it to the DEAN!
Silicon Valley vampires.
Lyft is the next fitbit baaaaamwahhh
Levis are like Coca Cola. Everyone loves them
Smart Indian
Lyft doesn’t attract the driver that’s why they are losing money
1:22 OMG IT'S A RAT!!!!! 😂😂
Valation