Know The Difference Minute

One extra zero in an earnings statement caused a $2 billion swing. 

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One extra zero.
Welcome to the Know the Difference Minute for Wednesday, February 14th.
It wasn’t long after rideshare company Lyft issued an earnings press release that the stock took off like a rocket. Up more than 60% after indicating a margin expansion of 500 basis points—essentially, a 5% pop in 2024.
Turns out, it was a typo. Instead of 500 basis points—the actual projection was 50 basis points—or .5%.
Lyft share prices settled back to reality after the correction—mostly because numbers still beat analysts estimate—but the gap between reality and the price jump based on 500-basis points was equal to over $2 billion in market cap.
Mistakes happen. The most impressive part of this story is that Lyft’s CEO took the blame—even though you know he didn’t write the press release or build the deck. That is admirable.
I’m Dave Spano from Annex Wealth Management. That is your Know the Difference Minute.