Citi analysts raised their price target for DoorDash Inc. (NASDAQ:DASH) to $155, up from $144, while maintaining a Buy rating on the stock.
The analysts’ positive outlook follows DoorDash’s recently announced second-quarter 2024 results, which showed promising trends in several key areas. Order frequency increased, U.S. monthly active users (MAUs) saw double-digit growth, and DashPass subscribers reached record highs. Additionally, new vertical MAU adoption exceeded the fourth quarter’s 20%, contributing to faster growth in June compared to April.
DoorDash also expanded its merchant base in the U.S. by tens of thousands in the second quarter. The company reported improved dasher efficiency, reduced merchant churn rates, and lower average order defect rates, leading to expanding margins.
The analysts believe that DoorDash continues to gain a larger share of the food delivery market more efficiently. Although acknowledging potential risks from a slowing macroeconomic environment, the analysts noted that the second-quarter results and third-quarter guidance, which projects approximately 18% year-over-year growth in gross order value (GOV), indicate strong demand trends.