Delivery company DoorDash (DASH) might best be known for dropping off food at your door, but in Australia, it has taken on a whole new dimension. In fact, it is currently being called a “game-changer” move, doing the downright impossible of making Costco (COST) goods available to non-Costco members. That break gave shareholders a second wind, and sent shares up nearly 2.5% in Wednesday afternoon’s trading.
DoorDash managed to do something downright impressive in Australia; it has a new deal with Costco that will allow it to deliver to non-members, a move that some are already calling a “game-changer.” For shoppers in Sydney, Perth, Melbourne, and a few other places—as long as they live within about an hour’s drive of a Costco location—they will be able to not only shop there, but also get their goods delivered to their door.
One such shopper, Kimberly Caruso—a mother of two under the age of nine—noted that taking her kids shopping with her is a “…task in itself…,” and welcomes the opportunity to simply place an order and have it delivered. Caruso also welcomes the opportunity to buy in bulk and plan ahead for things like school lunches. Meanwhile, both Costco and DoorDash will likely have a customer for life thanks to this.
Analysts are Cheerful Too
These developments are also calling the attention of analysts as well. Jefferies analyst John Colantuoni, who has a four-and-a-half star rating on TipRanks, called attention to DoorDash by keeping a Buy recommendation in place, and put a price target of $250 per share on the stock.
Colantuoni specifically cited what we just cited above: its international growth. Deals like the Costco deal are going to fire up the company’s stock price for some time to come. While certainly, its United States operations are likely to take a hit as the long-delayed—depending on who you ask—recession threatens, the fact that DoorDash has been opening up entire other countries is going to soften that blow quite a bit.
Is DoorDash a Good Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on DASH stock based on 23 Buys and seven Holds assigned in the past three months, as indicated by the graphic below. After a 37.59% rally in its share price over the past year, the average DASH price target of $223.85 per share implies 18% upside potential.
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