Is Lyft Going to $13? 1 Wall Street Analyst Firm Thinks So.

After years of underperformance, Lyft (NASDAQ: LYFT) stock may finally be ready for a comeback.

The No. 2 ride-sharing company in the U.S. just posted its first-ever generally accepted accounting principles ( GAAP ) profit as a detente with rival Uber has benefited both companies. Lyft has improved its service and tapped into new revenue streams like advertising.

Billionaire hedge fund managers seem to be taking notice. Two prominent ones -- David Tepper and Ken Griffin -- bought the stock in the second quarter, and now one Wall Street analyst firm is noting Lyft's improvement as well.

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Nomura upgrades Lyft

Nomura raised its rating on the ride-sharing stock from reduce to neutral, noting that Lyft's turnaround efforts focused around cost-cutting and operational improvements are starting to show results.

The firm also noted the earlier recovery in Uber stock, implying a similar opportunity for Lyft as both companies have reduced driver and rider incentives, supporting profitability.

Nomura also lowered its price target from $15 to $13 a share for Lyft, though that reflects the stock's decline this year. That implies a 10% upside from its price on Monday afternoon.

However, considering that Nomura was previously bearish on the stock, that's actually below the average analyst price target at $14.56.

Can Lyft bounce back?

Recent results from Lyft were encouraging as revenue in the quarter jumped 41% to $1.4 billion on a 17% increase in gross bookings and benefiting in part from the growth in the advertising business.

Management also introduced a price lock feature to help riders better avoid Lyft Primetime charge, or "surge pricing," and the company expects mid-teens growth in rides for the year, indicating solid growth.

If the company can maintain its current momentum, the stock should move higher over the coming quarters.

Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Uber Technologies. The Motley Fool has a disclosure policy .