Wells Fargo analyst Ken Gawrelski has maintained their neutral stance on DASH stock, giving a Hold rating on April 15.
Ken Gawrelski has given his Hold rating due to a combination of factors surrounding DoorDash’s proposed acquisition of Deliveroo. The acquisition, valued at approximately $2.8 billion, aims to expand DoorDash’s market presence into new regions, potentially increasing its total addressable market. However, the deal is seen as growth dilutive, as it involves entering highly competitive and mature markets, which may not significantly enhance DoorDash’s growth trajectory.
While the acquisition could be financially accretive given the lower valuation of Deliveroo compared to DoorDash, the modest financial benefits are counterbalanced by the potential drag on growth. Deliveroo’s lower growth rate and competitive challenges, particularly in the UK and other smaller markets, contribute to this cautious outlook. As a result, Gawrelski maintains a Hold rating, reflecting a balanced view of the potential risks and rewards associated with the acquisition.
In another report released on April 15, Wedbush also maintained a Hold rating on the stock with a $190.00 price target.
DASH’s price has also changed moderately for the past six months – from $153.880 to $187.760, which is a 22.02% increase.