☰
The activist investor reportedly wants a strategic review, improved capital allocations, and the elimination of Lyft’s dual-class share structure.
Lyft (LYFT) stock gained 2.2% on Tuesday after Bloomberg News reported that activist investor Engine Capital has built a stake in the company and is pushing for a strategic review.
The report, citing a letter, said that Engine has acquired a 1% stake and has been engaging with Lyft management in recent weeks to voice concerns surrounding the ride-hailing firm’s stock price, strategic positioning, and corporate governance.
The report, citing a person familiar with the matter, added that the stake is worth about $50 million.
The activist investor reportedly wants a strategic review, improved capital allocations, and the elimination of Lyft’s dual-class share structure.
According to a Reuters report, Engine Capital has also nominated two director candidates. As per a regulatory filing, at the end of 2024, Engine owned less than 1% of Lyft.
The company remains locked in a price war with its larger rival, Uber, to gain market share in the U.S. However, some analysts have said that its competitive pricing would help improve rider metrics.
Lyft forecasted first-quarter gross bookings to be below estimates in February.
Earlier in March, Lyft said it would begin rolling out autonomous vehicles as soon as this summer. The company has signed agreements with partners like May Mobility, Mobileye and Marubeni to do so.
Engine has campaigned for changes at several companies, including British engineering firm Smiths Group and Canada’s Parkland.
Retail sentiment on Stocktwits jumped to ‘extremely bullish’ (83/100) territory from ‘neutral’(46/100) a day ago, while retail chatter surged to ‘extremely high.’
One bullish retail trader said that Upwork shares had gained 33% since Engine Capital revealed a stake in the firm in September.
Another investor hoped that the stock would hit $13 on Wednesday.
Lyft shares have fallen 3.2% year-to-date (YTD).
For updates and corrections, email newsroom[at]stocktwits[dot]com.<
subscribe to Asianet Newsable WhatsApp channel by clicking here.