LYFT 3Q26: FSAs are useful

Bernstein maintains a Market-Perform rating and an 18 USD price target on Lyft. Q3 gross bookings grew 17% Y/Y, a touch light versus the firm's 18% model, while the Q4 guide of 13-17% was in line with prior expectations of 15% and leaves the overall outlook largely unchanged. Q3 adjusted EBITDA of 204M USD beat estimates and topped guidance; the Q4 outlook of 188-213M USD encompasses the pre-earnings model and the firm nudges up to the higher end. California insurance reform and reserve releases created extra capacity to invest in 2026, and management was positive on insurance leverage in 2027, though more tempered gross margin and S&M growth are expected. Rider incentive per trip grew 76% Y/Y and likely moderates in 2027. Membership via Lyft Go, the DoorDash partnership, premium and sparse markets, and a doubling of Canada trips are bright spots. The firm rolls its valuation base year to 2028 and cuts the multiple to 7x adjusted EBITDA from 8x on increased AV uncertainty, seeing susta