Avis Budget Group (NASDAQ:CAR) & Lyft (NASDAQ:LYFT) Critical Analysis

Lyft (NASDAQ:LYFT) and Avis Budget Group (NASDAQ:CAR) are both mid-cap industrials companies, but which is the superior business? We will compare the two businesses based on the strength of their valuation, earnings, dividends, risk, profitability, analyst recommendations and institutional ownership.

Earnings and Valuation

This table compares Lyft and Avis Budget Group”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lyft	$6.32 billion	1.01	$2.84 billion	$6.88	2.45
Avis Budget Group	$11.65 billion	0.44	-$889.00 million	($18.17)	-7.93

Lyft has higher earnings, but lower revenue than Avis Budget Group. Avis Budget Group is trading at a lower price-to-earnings ratio than Lyft, indicating that it is currently the more affordable of the two stocks.

Volatility & Risk

Lyft has a beta of 1.8, meaning that its stock price is 80% more volatile than the S&P 500. Comparatively, Avis Budget Group has a beta of 1.92, meaning that its stock price is 92% more volatile than the S&P 500.

Institutional and Insider Ownership

83.1% of Lyft shares are held by institutional investors. Comparatively, 96.3% of Avis Budget Group shares are held by institutional investors. 0.9% of Lyft shares are held by company insiders. Comparatively, 50.5% of Avis Budget Group shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Lyft and Avis Budget Group’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lyft	42.32%	-1.20%	-0.36%
Avis Budget Group	-5.43%	N/A	-0.37%

Analyst Ratings

This is a breakdown of current ratings and price targets for Lyft and Avis Budget Group, as reported by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lyft	2	23	13	0	2.29
Avis Budget Group	4	5	0	0	1.56

Lyft presently has a consensus target price of $19.77, indicating a potential upside of 17.51%. Avis Budget Group has a consensus target price of $135.57, indicating a potential downside of 5.88%. Given Lyft’s stronger consensus rating and higher probable upside, analysts plainly believe Lyft is more favorable than Avis Budget Group.

Summary

Lyft beats Avis Budget Group on 9 of the 14 factors compared between the two stocks.

About Lyft

Lyft, Inc. operates a peer-to-peer marketplace for on-demand ridesharing in the United States and Canada. It operates multimodal transportation networks that offer access to various transportation options through the Lyft platform and mobile-based applications. The company's platform provides a ridesharing marketplace, which connects drivers with riders; Express Drive, a car rental program for drivers; and a network of shared bikes and scooters in various cities to address the needs of riders for short trips. It also offers centralized tools and enterprise transportation solutions, such as concierge transportation solutions for organizations; Lyft Pink subscription plans; Lyft Pass commuter programs; first-mile and last-mile services; and university safe rides programs. The company was formerly known as Zimride, Inc. and changed its name to Lyft, Inc. in April 2013. Lyft, Inc. was incorporated in 2007 and is headquartered in San Francisco, California.

About Avis Budget Group

Avis Budget Group, Inc. engages in the provision of vehicle sharing and rental services. It operates through the following segments: Americas, International, and Corporate and Other. The Americas segment includes the vehicle rental and car sharing operations in North America, South America, Central America, and the Caribbean. The International segment is involved in the vehicle rental and car sharing operations in Europe, the Middle East, Africa, Asia, and Australasia. The company was founded in 1946 and is headquartered in Parsippany, NJ.