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On Tuesday, Truist Securities updated its financial model for Doximity Inc (NYSE:DOCS), which resulted in an increased price target for the company's shares. The new target is set at $35.00, up from the previous $31.00, while the firm has kept its Hold rating on the stock.
The revision follows the release of Doximity's FY1Q25 earnings. Truist Securities has adjusted its forecast for the company's revenue and EBITDA for fiscal years 2025 and 2026. The FY25 revenue estimate has been increased to $522.8 million from $515.1 million. However, the FY26 revenue projection has been slightly lowered to $571.9 million from the earlier estimate of $586.0 million.
EBITDA expectations have also been modified. The FY25 EBITDA estimate is now $255.8 million, up from $247.5 million. Meanwhile, the FY26 EBITDA forecast has been decreased to $279.4 million from the previous estimate of $281.9 million.
The price target adjustment is based on a 12-18 month forward-looking multiple applied to the company's estimated 2026 EBITDA. The target price of $35.00 is derived from a multiple of 20 times the projected adjusted EBITDA for calendar year 2026, which stands at $299.7 million. The firm reiterated its Hold rating on Doximity's shares, indicating that while they see improved financial metrics, they are not recommending a change in investment stance at this time.
In other recent news, Doximity Inc has been the subject of several analyst firms' reviews, following robust financial results. The company reported first-quarter revenues of $126.7 million, surpassing their guidance by $6.2 million. Doximity's adjusted EBITDA for the quarter was $65.9 million, exceeding expectations by $9.9 million. Piper Sandler, influenced by these strong earnings, raised its price target for Doximity to $31.00 from the previous $28.00, maintaining a Neutral rating.
On the other hand, Wells Fargo downgraded Doximity's shares and reduced the price target to $19.00, citing concerns over the company's growth trajectory. Barclays held steady, maintaining its ratings and price targets for Doximity. Needham upgraded its rating on Doximity to Buy, setting a price target of $38.00, citing strong momentum with large customers and new product innovations.
Evercore ISI increased the price target for Doximity to $34.00, following the company's robust financial results. The company's recent performance has been bolstered by significant growth and engagement, with new product offerings seeing substantial growth.
InvestingPro Insights
Following the recent update from Truist Securities on Doximity Inc (NYSE:DOCS), it's worth noting that InvestingPro data and tips provide additional context for investors considering the company's stock. Doximity's management has demonstrated confidence in the company's future by aggressively buying back shares, a strategy often viewed as a positive signal about the company's valuation and prospects. Moreover, with the company holding more cash than debt on its balance sheet, financial flexibility is a strength for Doximity, especially in a dynamic market environment.
InvestingPro data shows a strong gross profit margin of 89.65% for the last twelve months as of Q1 2025, underscoring the company's ability to maintain profitability. Additionally, with a significant return over the last week of 33.14%, investors have shown a renewed interest in the stock, which is currently trading near its 52-week high at 95.7% of the high point. This level of performance is complemented by the fact that 12 analysts have revised their earnings upwards for the upcoming period, reflecting a positive consensus on the company's earnings potential.
Investors seeking a deeper dive into Doximity's financials and future outlook can find over 15 additional InvestingPro Tips at https://www.investing.com/pro/DOCS, offering a comprehensive analysis that can further inform investment decisions.
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