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Wells Fargo cites US growth, raises DoorDash share price target By

Apr 4, 2024

On Thursday, Wells Fargo adjusted its outlook on DoorDash Inc. (NASDAQ: NASDAQ:), increasing the share price target to $125 from the previous $100. The firm continues to hold an Equal Weight rating on the stock.

The change comes as the analyst notes an uptick in first-quarter estimates, driven by consistent growth in the U.S. marketplace. However, expectations are set for a relatively conservative second-quarter guide and no changes to the full-year 2024 guidance.

The analyst highlighted that key factors to watch include DoorDash’s market share in the U.S. and its progress in the grocery and convenience sectors. The update in the price target reflects a balanced view of the company’s performance, acknowledging consistent U.S. marketplace growth alongside a slight slowdown in Wolt’s momentum.

For the first quarter of 2024, the Gross Order Value (GOV) forecast for DoorDash has been increased by 2% to $79.3 billion, surpassing the consensus estimate of $78.8 billion. This adjustment is based on the sustained growth trajectory from the fourth quarter of 2023, where year-over-year growth was approximately 21%, to the first quarter of 2024, with an anticipated growth of 20% year-over-year, as indicated by credit card and app data.

Despite the overall positive growth, there has been a partial offset due to Wolt, DoorDash’s international segment, which showed a slight decline in performance. Data from the app’s Daily Active Users (DAUs) revealed a reduced year-over-year growth rate in February and March compared to January.

InvestingPro Insights

As DoorDash Inc. (NASDAQ: DASH) sees an increase in price target from Wells Fargo, real-time data and insights from InvestingPro further enrich our understanding of the company’s financial health and market performance. With a market capitalization of $56.07 billion, DoorDash is a significant player in the delivery service industry. Despite not being profitable in the last twelve months, the company is expected to see net income growth this year. This aligns with the analyst’s observation of consistent growth in the U.S. marketplace.

InvestingPro Tips highlight that DoorDash holds more cash than debt on its balance sheet, and its liquid assets exceed short-term obligations, providing a stable financial cushion. Moreover, the stock has experienced a strong return over the last three months, with a price total return of 47.8%, and is trading near its 52-week high, reflecting investor confidence and market momentum.

For those looking to delve deeper into DoorDash’s financials and future prospects, InvestingPro offers additional tips and metrics. With PRONEWS24, readers can get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, gaining access to a total of 13 InvestingPro Tips for DoorDash, including insights on earnings revisions, volatility, and valuation multiples.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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