DoorDash (NASDAQ:DASH) Shares Gap Up Following Earnings Beat

DoorDash, Inc. (NASDAQ:DASH) gapped up before the market opened on Thursday after the company announced better than expected quarterly earnings. The stock had previously closed at $169.49, but opened at $179.13. DoorDash shares last traded at $179.2130, with a volume of 1,814,464 shares traded.

The company reported $1.06 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.81 by $0.25. DoorDash had a return on equity of 8.48% and a net margin of 5.29%. The business had revenue of $4.62 billion for the quarter, compared to analyst estimates of $4.56 billion. During the same period last year, the company earned $0.55 EPS. The firm’s revenue was up 34.0% on a year-over-year basis.

DoorDash News Roundup

Here are the key news stories impacting DoorDash this week:

• Positive Sentiment: Strong third-quarter earnings: DoorDash reported adjusted EPS of $1.06, above the $0.81 consensus estimate, while revenue reached $4.62 billion versus expectations of $4.56 billion. Revenue increased 34% year over year, and the company reported quarterly records for marketplace gross order value, revenue and net income. DoorDash third-quarter financial results
• Positive Sentiment: Instacart acquisition expands DoorDash’s reach: DoorDash agreed to acquire Instacart in a cash-and-stock transaction valued at approximately $17 billion. Combining DoorDash’s restaurant network with Instacart’s grocery platform could increase consumer engagement, merchant services opportunities and delivery scale. The deal is also viewed as a response to competitive pressure from Amazon and Walmart. DoorDash Instacart acquisition strategy
• Neutral Sentiment: Instacart’s underlying business is growing: Instacart reported third-quarter gross transaction value growth of 15%, revenue growth of 17%, GAAP net income of $147 million and adjusted EBITDA of $342 million, up 23% year over year. The results support the strategic rationale for the transaction, although the acquisition is not expected to close until late 2027 or early 2028. Instacart third-quarter financial results
• Negative Sentiment: Acquisition concerns are weighing on DASH: The $17 billion price tag creates execution, integration and potential dilution risks, while the long closing timeline leaves uncertainty around regulatory approval and expected synergies. Reports that DoorDash shares declined after news of the deal suggest investors may be concerned that the company is paying a premium and taking on additional complexity.

Analysts Set New Price Targets

DASH has been the subject of several analyst reports. Needham & Company LLC restated a “buy” rating and set a $265.00 target price on shares of DoorDash in a research report on Thursday, August 6th. TD Cowen reiterated a “buy” rating on shares of DoorDash in a research report on Tuesday. Bank of America reissued a “buy” rating on shares of DoorDash in a research note on Thursday, August 6th. Wells Fargo & Company upped their target price on shares of DoorDash from $225.00 to $230.00 and gave the company a “cautious” rating in a research note on Monday, October 5th. Finally, Truist Financial increased their target price on shares of DoorDash from $330.00 to $336.00 and gave the stock a “buy” rating in a report on Thursday, August 6th. Two investment analysts have rated the stock with a Strong Buy rating, thirty-one have issued a Buy rating, eight have assigned a Hold rating and two have assigned a Sell rating to the company. According to data from MarketBeat, the company has an average rating of “Moderate Buy” and a consensus price target of $254.95.

Insider Buying and Selling

In other news, CEO Tony Xu sold 29,567 shares of DoorDash stock in a transaction on Monday, August 24th. The stock was sold at an average price of $230.00, for a total value of $6,800,410.00. Following the transaction, the chief executive officer owned 1,500 shares in the company, valued at approximately $345,000. This trade represents a 95.17% decrease in their position. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Stanley Tang sold 72,367 shares of the firm’s stock in a transaction that occurred on Friday, August 21st. The shares were sold at an average price of $225.16, for a total transaction of $16,294,153.72. Following the completion of the sale, the director owned 10,361 shares in the company, valued at approximately $2,332,882.76. The trade was a 87.48% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders have sold 393,998 shares of company stock valued at $85,861,330 in the last ninety days. 44.90% of the stock is currently owned by company insiders.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently bought and sold shares of DASH. Janus Henderson Group PLC boosted its stake in DoorDash by 40.2% during the 1st quarter. Janus Henderson Group PLC now owns 7,762,553 shares of the company’s stock valued at $1,159,377,000 after purchasing an additional 2,225,954 shares during the last quarter. Robeco Institutional Asset Management B.V. lifted its position in shares of DoorDash by 2,304.0% during the 3rd quarter. Robeco Institutional Asset Management B.V. now owns 3,452,110 shares of the company’s stock valued at $633,635,000 after buying an additional 3,308,512 shares in the last quarter. Assenagon Asset Management S.A. raised its position in shares of DoorDash by 372.0% during the 3rd quarter. Assenagon Asset Management S.A. now owns 3,137,719 shares of the company’s stock valued at $575,928,000 after purchasing an additional 2,472,980 shares during the period. Temasek Holdings Private Ltd raised its stake in DoorDash by 49.4% during the 1st quarter. Temasek Holdings Private Ltd now owns 3,461,501 shares of the company’s stock valued at $519,744,000 after purchasing an additional 1,145,078 shares during the period. Finally, Bank of America Corp DE grew its stake in DoorDash by 18.4% during the first quarter. Bank of America Corp DE now owns 3,449,266 shares of the company’s stock valued at $517,907,000 after acquiring an additional 536,080 shares in the last quarter. 90.64% of the stock is owned by institutional investors and hedge funds.

DoorDash Price Performance

The firm has a fifty day simple moving average of $199.53 and a two-hundred day simple moving average of $183.47. The company has a debt-to-equity ratio of 0.27, a quick ratio of 1.37 and a current ratio of 1.37. The firm has a market cap of $78.00 billion, a PE ratio of 94.05 and a beta of 1.90.

About DoorDash

DoorDash, Inc (NASDAQ:DASH) operates a local commerce platform that connects consumers with restaurants, grocery stores, convenience retailers and other merchants. Through its website and mobile applications, customers can browse products, place orders for delivery or pickup, and access related services.

The company provides merchants with ordering, delivery, logistics, marketing and payment tools. Its offerings include the DoorDash Marketplace, subscription programs such as DashPass, and delivery infrastructure that merchants can use through services including DoorDash Drive.