In a show of strong faith in the ride-hailing company, Lyft Inc., the firm’s lead independent director, Sean Aggarwal, has invested a hefty $1 million in company stock. This move aligns him with the company’s Chief Executive, David Risher, who also invested a similar amount earlier this month. Aggarwal, an early investor in Lyft, acquired 96,900 shares at an average price of $10.337, according to a recent filing with the Securities and Exchange Commission.

Aggarwal’s investment comes as a bullish move at a time when Lyft’s shares have significantly underperformed compared to its rival, Uber Technologies Inc. Uber’s shares have outpaced Lyft’s so far this year, trading above its IPO price of $45, albeit marginally. Meanwhile, Lyft’s shares have seen a stark drop, tumbling 85% from their $72 IPO price. This investment pattern within Lyft starkly contrasts with the recent $4.5 million stock sale by Uber’s outgoing Chief Financial Officer, Nelson Chai.

Lyft’s Lead Independent Director and CEO Invest Heavily in Company Shares

Lyft Inc.’s lead independent director, Sean Aggarwal, recently bought $1 million worth of the ride-hailing company’s stock, following in the footsteps of Chief Executive David Risher who made a similar purchase earlier in the month.

Aggarwal’s Investment

Aggarwal, an early investor in Lyft, purchased 96,900 shares at an average price of $10.337 in the latest transactions, according to a filing with the Securities and Exchange Commission. In a statement to MarketWatch, Aggarwal expressed confidence in the company, stating, "With David Risher now in the driver’s seat, I am doubling down and view this as another great investment opportunity."

Aggarwal holds his recently purchased shares in a trust shared with his spouse that currently owns about 971,000 Lyft shares. In addition, Aggarwal reports two separate trusts that hold 283,000 and 200,000 shares, respectively. He also owns just over 59,700 shares directly, though some of these are restricted stock units.

Other Insider Purchases

Notably, Aggarwal’s purchase follows that of CEO David Risher, who paid $1.15 million to buy up Lyft shares in mid-August. Expressing his faith in the team, Risher commented, "Seeing this team in action shows me it’s the best investment I could make."

Board member Dave Stephenson, who also serves as the chief financial officer of Airbnb Inc., similarly invested $100,000 in Lyft stock in mid-August. These insider purchases mark a contrast to the $4.5 million stock sale by Nelson Chai, the outgoing chief financial officer of Uber Technologies Inc., disclosed last week.

Uber Vs Lyft Performance

Uber shares have significantly outperformed Lyft shares so far this year, trading above their IPO price of $45, albeit slightly. On the other hand, Lyft shares are down 85% from their $72 IPO price.

Takeaways

The recent insider purchases at Lyft offer an intriguing insight into the company’s current state. Despite the stock’s underperformance relative to its competitor Uber, Lyft’s director and CEO have shown remarkable confidence in the company’s potential. However, whether this confidence will translate into a significant upswing in Lyft’s stock performance remains to be seen.