CFRA upgrades DoorDash, lifts EPS estimates, price target

Investing.com - CFRA Research has upgraded its investment stance on DoorDash (NASDAQ: DASH), citing the food delivery platform’s high growth potential.

CFRA lifted its view on DoorDash to ‘buy’ from ‘hold’, and raised its 12-month price target to $158 from $110, reflecting financial strength (net cash of $4 billion) and higher growth.

“We upgrade our view on DASH due to our increased conviction in the company's accelerating growth trajectory across almost all of its business segments, driven by stickiness of its delivery ecosystem,” analysts at CFRA said, in a note.

The financial research company has also lifted its 2024 EPS estimate to $2.75 from $2.71 and 2025's to $3.96 from $3.54.

“We remain positive given high growth potential from subscription services (+18M members in 2023 vs. 15M in 2022) and expansion into grocery/retail/international boosting Marketplace GOV and orders (+22% GOV and +23% orders in Q4),” CFRA said.

It also sees a positive secular trend emerging within the gig economy, thanks to ample supply of labor and rising consumer demand.

“DASH's asset-light business model is well positioned to capitalize on this trend. We see DASH reaching positive earnings by the end of 2024 as it continues to gain scale and leverage its platform's operational efficiencies,” CFRA added.

DoorDash stock closed Monday at $138.25.

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