Can Lyft Be A Good Investment?

Lyft has filed S-1 for IPO on March 18th of this year (2019). Since Lyft isn’t yet a public company, we can’t really know the true numbers of Lyft’s finance. Nevertheless, leaked information tells us that although Lyft revenues are increasing tremendously it is also losing a lot of money on operational and R&D costs. Leaked information may not be accurate at all, but if the information is accurate Lyft may have to struggle a lot before it can become a profitable company.

According to the information we have Lyft is operating at a loss of $911 million net loss in 2018. Net loss is very important because a net loss tells us that Lyft isn’t a profitable company yet. It seems Lyft’s revenues are not able to cover the operating and R&D costs. The general definition of a net loss is that a total of expenses is bigger than a total of revenues.

Nevertheless, Lyft seems to boost its revenues very fast! In 2016, Lyft’s revenues were totaled at $343 million, but if the information is correct in 2018 Lyft’s revenues are totaled at $2.2 billion. If one looks at this closer, it seems Lyft has a chance of making it if the revenues are going to continue to go through this positive, exploding trajectory for some time to come.

Lyft is considering to invest more in R&D in regards to rolling out a self-driving fleet. If Lyft can get behind a self-driving fleet enormously and get the technology to work for real, then I think Lyft has a big chance to cut costs tremendously. If revenues continue to pick up, eating away Uber’s market share, and cut costing measures are going to be effective — Lyft could very well become a profitable company.

Lyft and Uber are competing for the same market, and both of these companies are driving Taxis out of business. Since Lyft and Uber are able to do this to Taxis, we can tell that companies like Amazon, Google, and even the car rentals and car dealerships themselves could get into the same act as Lyft and Uber when self-driving becomes a reality. This could be a very crowded market, and if my intuition is accurate it could mean Lyft and Uber may have a very tough market to operate in as time goes on. So the profits/revenues Lyft is having now could very well dwindle in the future!

Self-driving will change how people commute in the future. Car dealerships can jump into the act of allowing people to hail for self-driving cars. Perhaps, people of the future will not buy cars as much since they can just hail for a self-driving car? Google and other big tech companies can also create apps to allow the sharing of self-driving cars like how we have bike-sharing now. This could mean companies like Google don’t have to own a fleet of self-driving cars to be in the business of self-driving car-hailing. It’s like people to people self-dealing business but using a futuristic app of a huge tech giant where the tech giant gets to keep a small portion of the profit.

In summary and in truth, I’m not very sure if Lyft could be a good investment or not. Leaked info tells us that the company got a good chance of becoming profitable since the revenues keep on exploding to the positive territory — but the company has to be able to keep the operating and R&D costs down eventually! Nevertheless, the market which Lyft is operating in is possibly getting very crowded because of the self-driving car technology. If by the time the market gets so crowded and yet Lyft isn’t becoming profitable, then Lyft could find itself in a world of hurt! Personally, if I ever want to invest in Lyft, I won’t make it as one of my long term investments! If I ever invest in Lyft, I may have to watch out for the actions of other companies in the car-hailing market very closely. I may also have to watch out for new players that could enter the car-hailing market because new players could dilute the profitability of car-hailing market.


What Is The Future Market?

Don’t you hate to hear the future market this and that when you read or listen to the news?  Well, if you understand what future market is, you probably don’t mind hearing news on it.  Some people though, they may not know what the heck is the future market.  Thus, future market seems like a big mystery that will forever be a mystery into the future for these people.  Nonetheless, if you are one of those people who wants to understand what the future market is, then just check out the video right after the break.  In short though, future market is gambling, because you are betting on a contract price that represents for whatever it is in the market.

Stock Tweets May Screw With People More Than Help Them In Making Sound Investments

Everyone loves to predict how the stock market moves, because if they know or think that they know how the stock market behaves, they can either manipulate the stock market to their favors or just make outrageous amount of money.  It’s no stranger that the stock investors have been using electronic technology to aid them in making money in the stock market.  So we can safely assume that stock investors are somewhat technological savvies.  Some so called stock market investors also think Twitter can help them read stock market trends so more money can be made.

In my opinion, stock market is a beast that will swallow anyone who thinks of taming it except the very few stock savants.  It’s better to approach the stock market with insightful fundamentals of certain industries than reading the noises on Twitter.  Before I continue on, just to let you know I’m not an expert in stock market, but as any other human fellow, I’ve a lot opinions and brain power to mobilize my words across by blog.  I’m glad to clear that out so everyone of you has to think twice before blaming me for your miss opportunities within the stock market.

Anyway, Twitter is like a river that will carry just about anything you throw into it.  The stock market itself is already a noisy place, and adding Twitter into the confusion may make the matter worse.  Perhaps, it’s true that when there are a lot of people tweet about a stock, it may be a sign that signifies to everyone that the stock has something good or bad going on.  Then again, if that is always the case, everyone can just follow tweets and make money from the stock market.  Unfortunately, the stock market is also a market of human emotions.  Humans tend to rush to do things at wimps of changing emotions.  With that I mean not all human emotions arrive at common sense.  This is why the same stock can plunge today but rise higher tomorrow.  All of that though only good for short term stock traders such as day traders who care only about gaining a profit within hours.  Long term stock investors probably will not reap any benefit from dipping their toes into Twitter’s stock trends.

In the end, true value of a stock depends on the company it represents, and the company has to have good fundamentals to boost its stock in many years to come.  Here are just some examples of good fundamentals of a stock:  Great management team, huge market capitalization, leader of the market, innovative technology, low debts (depending on an industry), clear and easy to understand balance sheet, huge dividend if the company isn’t anticipating on expanding, low price per book, favorable political weather, and so on.  I think those fundamentals will be greater help than following the streams of tweets on stocks.

Disclaimer:  It’s up to each own mind and heart to decide how he or she is going about investing in the stock market.  Essayboard isn’t a blog on the stock market, and so you should not read for stock tips here.  Instead, my opinion is that following unknown stock tweets from strange sources for making a decision on what stock to buy or sell can be a very bad idea.