Citi reiterates Buy rating on GoDaddy stock with $234 price target

Investing.com - Citi has reiterated its Buy rating on GoDaddy Inc (NYSE:GDDY) with a price target of $234.00, citing potential upside despite soft investor sentiment heading into earnings. Currently trading at $168.48, the stock sits between analyst targets ranging from $150 to $250, with InvestingPro data showing the company maintains a "GOOD" overall financial health score.

The investment bank acknowledges current market concerns about customer metrics and Applications & Commerce (A&C) bookings but views these worries as an opportunity for investors. Citi expects GoDaddy to deliver at least in-line results with potential for margin outperformance.

Citi points to easing comparisons in the second half of 2025 as a potential catalyst that could address investor concerns about both customer growth and bookings performance. The firm believes GoDaddy continues to execute its strategy of focusing on higher-intent customers, with annual revenue reaching $4.66 billion and maintaining a five-year compound annual growth rate of 9%.

The bank anticipates continued momentum in the Applications & Commerce segment and sees "plenty of room" for growth in Presence & Business (P&B) with new product bundles. Citi also notes that GoDaddy’s AI assistant Airo is "still in the early innings" of development.

Citi expects margin improvements as GoDaddy begins to recognize cost benefits from implementing generative AI in customer care and technology development, supporting the firm’s free cash flow estimates and its 16x price-to-free-cash-flow target multiple, compared to the current 13x multiple.

In other recent news, GoDaddy Inc. reported strong financial results for the first quarter of 2025, exceeding analyst expectations with an earnings per share (EPS) of $1.51, surpassing the forecasted $1.38. The company’s revenue also exceeded projections, reaching $1.2 billion against an expected $1.19 billion, marking an 8% year-over-year growth. Free cash flow saw a 26% increase, amounting to $411 million, while customer count remained stable at 20.5 million. GoDaddy’s strategic focus on AI and pricing strategies was highlighted by several analyst firms. RBC Capital maintained its outperform rating, emphasizing the company’s robust free cash flow outlook and advancements in AI technology. JPMorgan raised its price target to $240 and maintained an Overweight rating, citing confidence in GoDaddy’s long-term growth trajectory, with revenue expected to expand by 6-8% from 2024 to 2026. Benchmark analysts reiterated a Buy rating with a $250 price target, noting the company’s AI-driven product innovations. Cantor Fitzgerald adjusted its price target to $190, maintaining a Neutral rating, while highlighting GoDaddy’s consistent progress on key initiatives and stock repurchases. These developments underscore GoDaddy’s strategic efforts and resilience in the face of macroeconomic challenges.

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