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Investing.com - Benchmark has lowered its price target on DoorDash Inc. (NASDAQ:DASH) to $315.00 from $320.00 while maintaining a Buy rating. Despite the slight reduction, this target remains well above the current price of $203.25 and represents a 55% upside from current levels. InvestingPro data shows DoorDash’s stock has delivered a strong 40.3% return over the past year, though it’s currently trading at a high P/E ratio of 150.5.
The firm cited DoorDash’s "hundreds of millions of investments incremental to ’25E levels" as driving a divergence from the company’s historically steady fixed cost leverage.
Benchmark identified three main investment areas: global tech platform development with multi-region redundancy and AI-driven data processing; autonomy initiatives with partners and in-house devices; and software expansion requiring additional engineering and sales headcount.
Despite these investments, DoorDash expects to see some leverage within its core business year-over-year, which Benchmark interprets as a sign that the underlying business continues to benefit from scale as it expands to new markets like the U.K. and Ireland following the Deliveroo acquisition.
Benchmark views DoorDash’s investment strategy as justified given the company’s "proven ability to penetrate new verticals and markets" and the "ever-evolving landscape of localized commerce and subsequent TAM expansion," noting that the underlying business is accelerating.
In other recent news, DoorDash Inc. reported third-quarter results that surpassed expectations, showing a roughly 2% increase in gross order value and a 3% rise in adjusted EBITDA. Despite these strong results, several analyst firms adjusted their price targets for DoorDash. RBC Capital lowered its price target to $270, maintaining an Outperform rating, and noted the company’s strong performance and potential market share growth. Truist Securities also adjusted its price target to $330, citing higher investment plans but maintained a Buy rating. Wells Fargo reduced its price target to $239, noting DoorDash’s reinvestment phase, which contrasted with market expectations following the Deliveroo acquisition. DA Davidson maintained a Neutral rating with a $260 price target, acknowledging the company’s strong quarterly performance. The adjustments in price targets reflect varying perspectives on DoorDash’s investment strategies and market positioning. Additionally, Lyft received attention as Wells Fargo increased its price target to $20, citing strong third-quarter results and stable trends in bookings guidance.
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