There are multiple developments that could drive DoorDash stock higher in the near term. Firstly, Covid-19 cases in the U.S. are soaring to all-time highs, averaging over 700,000 cases over the last week and this could cause more people to order in rather than head to restaurants, helping demand for DoorDash’s services.
Is DoorDash’s market price too high?
We think DoorDash’s current market price of about $160 per share (over 18x estimated 2020 Revenue) is too high for a couple of reasons. Firstly, it’s highly likely that the company’s era of hyper-growth is behind it.
Is DoorDash’s multiple better than Uber and GrubHub?
While this multiple is well ahead of Grubhub, which trades at about 3.6x projected Revenue, and Uber which trades at around 7.1x, DoorDash justifies this multiple for a couple of reasons. Firstly, growth has been much stronger, with Revenue on track to grow about 200% each year between 2018 and 2020.
What is the gross order value of DoorDash in 2020?
DoorDash’s Gross Order Value - or the total value of orders placed on its marketplace - grew from around $2.8 billion in 2018 to $8 billion in 2019. We expect it to rise to about $24 billion in 2020, as Covid-19 caused orders made on the platform to surge almost 3x over the first nine months of the year.
Is DoorDash stock overpriced?
While DoorDash has seen demand for its services soar through Covid-19, garnering roughly half the U.S. delivery market, we still think the company is quite overvalued at current levels, and estimate its fair value at closer to $90 per share.
Is DoorDash stock a good buy?
While the company received a B+ for growth and a C- for profitability, it was given a D for momentum, a D+ for revisions, and a D- for valuation. For a bullish view on DoorDash, read SA contributor Julian Lin's “Door Dash: Positive Cash Flow, 13% Net Cash, Long Growth Runway, Moving to Buy”.
Why is DoorDash stock up today?
DoorDash shares soared on Thursday after the company reported fourth-quarter results that beat on the top line and showed strong order numbers.
Will DoorDash keep growing?
DoorDash total orders continue to grow during the pandemic. While most of its orders are for food from restaurants, DoorDash sees itself as more than just meal delivery. The company has expanded its services to supermarkets, bodegas, flower shops, and convenience stores like 7-Eleven and Wawa.
Is DASH a Buy or sell?
Out of 18 analysts, 6 (33.33%) are recommending DASH as a Strong Buy, 4 (22.22%) are recommending DASH as a Buy, 8 (44.44%) are recommending DASH as a Hold, 0 (0%) are recommending DASH as a Sell, and 0 (0%) are recommending DASH as a Strong Sell. What is DASH's earnings growth forecast for 2022-2024?
What type of stock is DoorDash?
What is DoorDash's stock symbol? DoorDash trades on the New York Stock Exchange (NYSE) under the ticker symbol "DASH."
Can DoorDash be profitable?
DoorDash has never made a profit and although the US food delivery market is consolidating, it still looks unlikely that it will post a profit in 2021.
Is DoorDash a franchise?
DoorDash, Inc. is an American company that operates an online food ordering and food delivery platform. DoorDash went public in December 2020 on NYSE and trades under the symbol DASH....DoorDash.TypePublicHeadquartersSan Francisco, California , United StatesArea servedAustralia Canada Germany Japan United States16 more rows
How many shares of DoorDash are there?
Share StatisticsAvg Vol (3 month) 35.94MShares Outstanding 5320.98MImplied Shares Outstanding 6N/AFloat 8238.67M% Held by Insiders 10.59%7 more rows
Why is DoorDash not profitable?
"Essentially, the reason that DoorDash and Uber Eats have continued to lose money is because they make very little incremental profit when those food orders are placed," says McCarthy. The delivery apps make money by charging restaurants a commission for each order placed through the app.
How many dashers are there?
More than 100,000 Dashers across the US and Canada fulfill millions of deliveries per month and our full-time headcount has grown to 400 people.
How much does DoorDash make a day?
Average DoorDash pay is in the range of $15-$25/hour. If you worked 4 hours, you could make $60-$100/day. That would be as if DoorDash was a part-time job. If you worked it like a full-time job, working 8 hours a day, you could make around $120-$200/day.
How does DoorDash make money?
DoorDash primarily makes money by charging restaurants a commission based on the total dollar order value and also charges a fee to consumers for using its platform. The company also generates revenue from membership fees paid by consumers for its subscription service - DashPass and by charging per-order fees to merchants that use its logistics to service orders under its Drive third party program. DoorDash’s Gross Order Value - or the total value of orders placed on its marketplace - grew from around $2.8 billion in 2018 to $8 billion in 2019. We expect it to rise to about $24 billion in 2020, as Covid-19 caused orders made on the platform to surge almost 3x over the first nine months of the year. The company’s Total Revenue has grown from around $0.3 billion in 2018 to about $0.9 billion in 2019 and is likely to jump to about $2.8 billion this year.
How much is DoorDash worth in 2020?
We expect it to rise to about $24 billion in 2020, as Covid-19 caused orders made on the platform to surge almost 3x over the first nine months of the year. The company’s Total Revenue has grown ...
Does DoorDash have switching costs?
There are no real switching costs for users, who often use multiple apps. While DoorDash’s contracts with most of the largest U.S. restaurant brands and its subscription offering help it to an extent, it doesn’t fully mitigate the risks for the company. Trefis.
Does DoorDash have a loss?
Secondly, DoorDash has also cut its losses, as its Revenues have expanded much more quickly than its cost base. Operating Margin rose from about -72% in 2018 to levels of about -7% over the first nine months of 2020. In comparison, Grubhub and Uber still remain deeply lossmaking.
The stock has started to attract attention from institutional investors
I've been a contributor with the Motley Fool since 2019 and it's been a supreme joy to try to help make the world a little smarter, happier, and richer every day. What's great about exploring business and the economy is the insight it gives you into how things are in the world.
What happened
Shares of DoorDash ( NYSE:DASH) spiked higher on Tuesday, possibly because it's gaining attention from institutional investors. As of 2 p.m. EST, the stock was up 8%.
So what
Tiger Global Management is an institutional investment manager, and the Securities and Exchange Commission (SEC) requires these entities to release their holdings every quarter. Among the holdings released today, Tiger Global revealed that it had purchased 1,596,000 shares of DoorDash.
Now what
Investors who are encouraged by Tiger Global Management's purchase of DoorDash stock should keep in mind that there's a slight lag between the report and now: We don't know if Tiger Global has bought any DoorDash stock lately. And considering the stock is up over 50% this year, it's possible it hasn't been a buyer during the first quarter of 2021.
The delivery platform made a pair of announcements that has the investment world buzzing
A Fool since 2019, and a graduate of Cal State LA with a B.S. in Finance and M.A. in Economics. Parkev is an adjunct professor of Finance and enjoys reading about financial and economic history. You'll often find him writing about stocks in the consumer goods and technology sectors.
Revenue nearly triples in Q1
DoorDash reported revenue of $1.1 billion for its first quarter. The result was much better than what analysts on Wall Street were expecting. The outperformance came as folks who started using DoorDash during the worst days of the pandemic maintained the habit even as states were easing restrictions at restaurants.
Rite Aid partnership
On May 11, DoorDash announced a partnership with Rite Aid.
Summary
DoorDash's stock is plummeting; I suspect investors are worried about the competition risks.
3 years from Challenger to Dominance
This is the graph that showcases beautifully how DoorDash in a relatively short time has amassed a leading position in the food delivery industry. Still, this graph does not show the underlying market shares per region which differ vastly.
The competition
Contrary to popular belief, DoorDash has not won food delivery in the entire US. Take Manhattan: in Manhattan, DoorDash operates a market share of 15%, which doesn't sound like a profitable share to me.
The giants
Short-term what worries me the most for DoorDash's prospects is the fact that Just Eat Takeaway ( OTCPK:TKAYF) is practically putting Grubhub for sale through a 'partnership', whatever a partnership may entail. More recently, there has also been speculation about a potential Grubhub sale.
DoorDash's vision
DoorDash sets out to be the logistics platform to deliver a broad range of goods, but for now, obviously, that is mostly food. Some readers ask me: what is the moat here? I think the moat is made up of valuable network effects which users experience as the supply of available merchants, consumers, and drivers increases.
Takeaway
The market is starting to rightfully question the prospects of this enterprise. If management achieves their goals, this stock is a potential 10 bagger. But with the juggernaut Amazon snooping around in the same-day delivery market, I seriously question whether the company will ever achieve its goals.