Robbins LLP is Investigating the Allegations that Lyft, Inc. (LYFT) Allegedly Made False and Misleading Statements Regarding its Margin Expansion
Robbins LLP informs investors that a shareholder filed a class action on behalf of all those who purchased or otherwise acquired Lyft, Inc. (NASDAQ: LYFT) common stock between February 13, 2024 at 4:05 p.m. and February 13, 2024 at 4:51 p.m. Lyft, Inc. operates a peer-to-peer marketplace for on-demand ridesharing in the United States and Canada.
The Allegations
According to the complaint, Lyft issued a press release and accompanying Supplement Data announcing its year-end and fourth quarter 2023 operating results after the close of the market (at 4:05 p.m.) on February 13, 2024. The Lyft press release and Supplemental Data (at page 10) misrepresented in a bulleted line item that Lyft anticipated “Adjusted EBITDA [Earnings Before Interest Taxes Depreciation and Amortization] margin expansion (calculated as a percentage of Gross Bookings) of approximately 500 basis points year-over-year.” Inasmuch as Lyft had reported 2023 EBITDA margins of approximately 1.6%, a 500 basis point (or 5.0%) margin expansion would have increased profitability to 6.6% — or by over three times historical results. News services and stock analysts reported promptly on the four-fold anticipated increase in profitability. However, the 500 basis point margin expansion was stated in error; in reality, the basis point margin expansion was just 50 points.
The misstatement set off an aftermarket rally, with Lyft’s common stock price increasing minute by minute. Lyft common shares had closed on February 13, 2024 at 4:00 p.m. at $12.13 per share. By 4:17 p.m., Lyft shares increased to $15.59 a share and by 4:27 p.m. shares traded at $16.61. Lyft shares went on to trade as high as $20.25 by approximately 4:41 p.m. When defendants finally addressed the error the stock began to decline, settling at $12.92 per share shortly after 4:50 p.m.
What Now: You may be eligible to participate in the class action against Lyft, Inc. Shareholders who want to serve as lead plaintiff for the class must file their papers with the court by May 6, 2024. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. If you choose to take no action, you can remain an absent class member.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
