Benchmark raises GoDaddy stock price target to $275

On Friday, Benchmark analyst Mark Zgutowicz increased the price target for GoDaddy Inc (NYSE:GDDY) shares to $275 from the previous $230 while maintaining a Buy rating on the company's stock. The new target represents significant upside potential for GoDaddy, which has already delivered an impressive 90.5% return over the past year. According to InvestingPro data, the company maintains a GREAT financial health score of 3.3 out of 5, with particularly strong profitability metrics. Zgutowicz underlined the decision to adjust the Discounted Cash Flow (DCF)-based price target upward, reflecting a slight increase in projected revenue for the year 2025.

The revised revenue estimate for 2025 now stands at approximately $4.919 billion, a 0.5% increase from earlier projections. This figure is marginally below the high end of GoDaddy's own revenue guidance, with a slight downward adjustment for the Applications & Commerce (A&C) sector and an upward revision for the Core Platform (CP) sector.

The analyst's expectations for the first quarter and full year of 2025 include robust growth in the A&C segment, anticipating high-teens year-over-year revenue growth. This is based on a solid bookings growth of over 20% in 2024, which outpaces the company's own guidance of mid-teens growth. Zgutowicz noted that the product mix, including transaction-related bookings that are recognized intra-quarter, may lead to a perceived mismatch between bookings and revenue growth.

The report also highlighted GoDaddy's Average Revenue Per User (ARPU) growth opportunities, pointing out a significant 16% year-over-year increase in average order size during the fourth quarter. The analyst mentioned that GoDaddy has new product levers that could be highly accretive to its revenue in the near term, such as the Digital Marketing Suite and GoDaddy Capital.

GoDaddy's conservative revenue guidance, particularly for Transaction-based revenue within the Aftermarket sector, was attributed to challenging comparisons and limited visibility into demand trends for large deals in the near term. Despite these conservative estimates, the analyst's outlook remains positive on the stock's potential.

In other recent news, GoDaddy Inc. has been the subject of multiple analysts' attention following its fourth quarter earnings report. The company's Q4 earnings fell short of expectations, with an adjusted earnings per share of $1.36 compared to the projected $1.43. However, it exceeded revenue expectations, reporting $1.19 billion against analysts' estimate of $1.18 billion.

Analysts from Raymond (NSE:RYMD) James, Cantor Fitzgerald, and Citi have updated their price targets for GoDaddy. Cantor Fitzgerald analyst Deepak Mathivanan cut the price target to $210, maintaining a Neutral rating, while Raymond James' Josh Beck lifted the target to $235, reiterating a Strong Buy rating. Citi analysts, on the other hand, raised their price target to $260, maintaining a Buy rating on the stock.

Despite the earnings miss, GoDaddy's strategic initiatives and product development, such as the Airo AI monetization path, have been highlighted as potential drivers for future growth. These recent developments indicate that the company's performance and fundamental outlook remain strong, with expectations of robust bookings growth in 2025.

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