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Is DASH Still a Strong Buy After Surging 61% Over the Past 6 Months?
DASHDoorDash(DASH) ZACKS·2025-01-14 18:16

Core Insights - DoorDash's shares have surged 61% over the past six months, significantly outperforming the Zacks Internet - Services industry's return of 2.9% and the broader Zacks Computer & Technology sector's appreciation of 0.2% [1] - The company has outperformed major competitors like Amazon and Alphabet, which gained 13.4% and 2.5% respectively during the same period [1] Growth Drivers - The share price momentum of DoorDash is attributed to strong growth in total orders and Marketplace Gross Order Value (GOV), enhanced logistics efficiency, and increased advertising contribution [2] - DoorDash registered a year-over-year increase of 18% in order volume, reaching a total of 643 million orders in Q3 2024, while the marketplace GOV grew by 19% to 20billion[5]StrategicPartnerships−DoorDashhaspartneredwithIbottatoofferpersonalizeddigitalpromotionsandcouponsacrossvariouscategories,enhancingitsmarketplacebeyondrestaurantdelivery[6]−ThecollaborationwithIbottaallowsDoorDash′s115,000+non−restaurantstoresinNorthAmericatoprovideaddedsavingsandengageconsumersthroughAI−drivenoptimization[7]−DoorDash′sexpandingpartnerbaseincludesWalmartCanada,WegmansFoodMarkets,Lyft,WarnerBros.Discovery′sstreamingserviceMax,andJPMorganChase,broadeningitsreachandserviceofferings[8]MarketExpansion−ThroughcollaborationwithWalmartCanada,DoorDashprovidesaccesstogroceryandgeneralmerchandisefromover300WalmartSupercenters[9]−AnexpandedpartnershipwithWegmansFoodMarketsenablesgrocerydeliveryfromallMarylandlocationsandsoonfromstoresinVirginia,NorthCarolina,NewJersey,Delaware,andupstateNewYork[10]−DoorDashoffersDashPassAnnualPlanmembersacomplimentaryMaxWithAdssubscription,providingsignificantvalue[11]FinancialPerformance−TheZacksConsensusEstimateforDoorDash′searningsin2025is20 billion [5] Strategic Partnerships - DoorDash has partnered with Ibotta to offer personalized digital promotions and coupons across various categories, enhancing its marketplace beyond restaurant delivery [6] - The collaboration with Ibotta allows DoorDash's 115,000+ non-restaurant stores in North America to provide added savings and engage consumers through AI-driven optimization [7] - DoorDash's expanding partner base includes Walmart Canada, Wegmans Food Markets, Lyft, Warner Bros. Discovery's streaming service Max, and JPMorgan Chase, broadening its reach and service offerings [8] Market Expansion - Through collaboration with Walmart Canada, DoorDash provides access to grocery and general merchandise from over 300 Walmart Supercenters [9] - An expanded partnership with Wegmans Food Markets enables grocery delivery from all Maryland locations and soon from stores in Virginia, North Carolina, New Jersey, Delaware, and upstate New York [10] - DoorDash offers DashPass Annual Plan members a complimentary Max With Ads subscription, providing significant value [11] Financial Performance - The Zacks Consensus Estimate for DoorDash's earnings in 2025 is 1.94 per share, indicating a year-over-year increase of 646.24% [12] - The revenue estimate for 2025 is pegged at 12.72billion,suggestinga19.1612.72 billion, suggesting a 19.16% increase from the estimated figure of 10.68 billion for 2024 [13] Valuation Insights - DoorDash's stock is considered not cheap, with a Value Score of D indicating a stretched valuation, trading at a Price/Book ratio of 9.24 compared to the industry's 6.31 [14] - Despite the high valuation, DoorDash's strong portfolio and expanding partner base contribute to its growth prospects, justifying the premium valuation [16]