KeyBanc cuts DoorDash stock target to $230, keeps Overweight rating

On Tuesday, KeyBanc Capital Markets adjusted its outlook on DoorDash Inc. (NASDAQ: NASDAQ:DASH), reducing the price target to $230 from the previous $240 while maintaining an Overweight rating on the stock. With DoorDash currently trading at $181.85, InvestingPro analysis suggests the stock is slightly overvalued, though analyst targets range from $150 to $250. The revision reflects a more conservative growth estimate for the food delivery company.

The firm’s analyst, Justin Patterson, noted that DoorDash remains a leading player in the food delivery sector, continuing to expand its market share. The company has demonstrated impressive revenue growth of 24.17% over the last twelve months, reaching $10.72 billion. The company has shown notable progress in the restaurant category and is also making strides in the grocery delivery space, where it has gained ground against competitors such as Amazon (NASDAQ:AMZN) and Instacart (NASDAQ:CART) on a year-over-year basis.

DoorDash’s subscription service, DashPass, was highlighted for its popularity and significant growth within the category. Patterson’s revised price target of $230 is based on a 26.2 times multiple of the company’s projected 2026 enterprise value to EBITDA (earnings before interest, taxes, depreciation, and amortization).

The new price target takes into account a decrease of 4% and 5% in the estimated EBITDA for the years 2025 and 2026, respectively. The figures have been adjusted to $2.68 billion for 2025 and $3.60 billion for 2026, indicating a more modest growth profile in light of the broader macroeconomic environment. Patterson’s commentary suggests that while growth expectations have been tempered, DoorDash’s position in the market remains strong.

In other recent news, DoorDash Inc. has announced a partnership with Domino’s Pizza (NYSE:DPZ), which will see orders on DoorDash’s Marketplace delivered by Domino’s drivers. This collaboration is set to launch nationwide in the U.S. in May 2025 and expand to Canada later that year. Truist Securities has maintained a Buy rating on DoorDash, with a price target of $235, citing the potential for significant growth from this partnership in the coming years. Analysts project that the partnership could add 50-70 basis points of growth in Gross Order Value for DoorDash in 2025 and over 100 basis points in 2026.

For Domino’s Pizza, Evercore ISI has reiterated an Outperform rating with a $480 price target, highlighting the strategic move as a way to reach new customer segments, particularly in suburban and rural areas. The partnership is anticipated to have a notable impact on Domino’s same-store sales, with projections suggesting a sales mix impact of approximately 6 percentage points and a same-store sales benefit of around 4 percentage points. The integration will allow Domino’s to leverage DoorDash’s extensive delivery network, enhancing its market presence and delivery capabilities. Both companies have emphasized the mutual benefits of this alliance, which aims to capitalize on the growing demand for digital ordering and delivery services.

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