Bernstein analyst Nikhil Devnani has maintained their bullish stance on DASH stock, giving a Buy rating yesterday.
Nikhil Devnani has issued a Buy rating for DoorDash’s stock based on a combination of robust growth prospects and anticipated improvements in profitability. The recent financial results from DoorDash have reinforced the firm’s positive outlook, displaying a strong trajectory in revenue growth alongside a climb in profit margins. In the face of high expectations, DoorDash’s fourth-quarter performance didn’t surpass previous quarters by a large margin, leading to a temporary cooling off in stock price post-earnings. However, Devnani sees this as an opportunity to invest, emphasizing the company’s status as a top-tier on-demand delivery service with a clear path to greater earnings.
Devnani’s optimism is further bolstered by conservative guidance from DoorDash, with the anticipation that the company’s Gross Order Value (GOV) will outperform the projected range for 2024, continuing a pattern of top-line beats and growth across various categories. Although there is an expectation of some slowdown, the predicted 18% year-over-year growth in GOV still places estimates above the company’s own guidance. Additionally, positive indicators such as the increase in monthly active users and subscribers provide a strong foundation for future performance. Devnani’s analysis suggests that despite a back-loaded margin ramp that might raise some concerns, there are several reasons to maintain confidence in DoorDash’s financial trajectory, including potential outperformance in GOV and control over discretionary reinvestment. This leads to an upward adjustment in EBITDA expectations and an increased price target, reinforcing the Buy rating.
In another report released yesterday, Bank of America Securities also reiterated a Buy rating on the stock with a $139.00 price target.
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Based on the recent corporate insider activity of 175 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of DASH in relation to earlier this year.
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DoorDash (DASH) Company Description:
Founded in 2013, DoorDash Inc is a California-based company which provides on-demand food delivery services in the United States, Canada, and Australia through its local logistics platform.
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