Contrasting Lyft (NASDAQ:LYFT) and PDD (NASDAQ:PDD)

Lyft (NASDAQ:LYFT) and PDD (NASDAQ:PDD) are both computer and technology companies, but which is the superior investment? We will contrast the two businesses based on the strength of their dividends, risk, earnings, institutional ownership, profitability, valuation and analyst recommendations.

Institutional & Insider Ownership

83.1% of Lyft shares are owned by institutional investors. Comparatively, 29.1% of PDD shares are owned by institutional investors. 3.2% of Lyft shares are owned by insiders. Comparatively, 3.7% of PDD shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares Lyft and PDD’s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Lyft	$4.40 billion	1.77	-$340.32 million	($0.89)	-21.89
PDD	$34.88 billion	4.41	$8.45 billion	$5.73	20.36

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

Profitability

This table compares Lyft and PDD’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Lyft	-7.73%	-54.80%	-5.41%
PDD	24.23%	39.10%	20.64%

Volatility & Risk

Lyft has a beta of 1.95, meaning that its share price is 95% more volatile than the S&P 500. Comparatively, PDD has a beta of 0.67, meaning that its share price is 33% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Lyft and PDD, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Lyft	1	17	5	0	2.17
PDD	0	1	8	0	2.89

Lyft currently has a consensus price target of $14.40, indicating a potential downside of 26.10%. PDD has a consensus price target of $146.85, indicating a potential upside of 25.88%. Given PDD’s stronger consensus rating and higher probable upside, analysts clearly believe PDD is more favorable than Lyft.

Summary

PDD beats Lyft on 12 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 PDD

PDD Holdings Inc., a multinational commerce group, owns and operates a portfolio of businesses. It operates Pinduoduo, an e-commerce platform that offers products in various categories, including agricultural produce, apparel, shoes, bags, mother and childcare products, food and beverage, electronic appliances, furniture and household goods, cosmetics and other personal care, sports and fitness items and auto accessories; and Temu, an online marketplace. It focuses on bringing businesses and people into the digital economy. The company was formerly known as Pinduoduo Inc. and changed its name to PDD Holdings Inc. in February 2023. PDD Holdings Inc. was incorporated in 2015 and is based in Dublin, Ireland.