DoorDash (DASH) Shares Soar 1.96% on Price Target Hike

Doordash (DASH) shares surged to a record high today, with an intraday gain of 1.96%.

The strategy of buying DASH shares after they reached a recent high and holding for 1 week showed poor performance over the past 5 years. The annualized return was -3.5%, significantly underperforming the market. This indicates that waiting for a recent high to enter a position often leads to underperformance, especially in the short term. It suggests a more disciplined approach, considering market conditions and the stock's fundamentals, might be beneficial.

Oppenheimer analysts have raised the price target for DoorDash to $280 from $220, citing stronger-than-expected third-party data and an increase in advertising revenue. This revision signals accelerating profitability for the company. The updated model projects $2.6 billion in ad revenue by 2027, underscoring DoorDash's strategic flexibility and potential for significant EBITDA growth.

The expansion in advertising opportunities is a key driver for DoorDash's projected growth. Analysts expect this to contribute to an improved EBITDA margin, with projections indicating that DoorDash could reach $4.5 billion in EBITDA by 2027, partially due to the growth in ad revenue.

Additionally, the potential acquisition of Deliveroo is anticipated to boost DoorDash's 2027 EBITDA by 9%, assuming growth and margin parity. This potential acquisition, though not yet confirmed in formal models, adds to the optimism surrounding DoorDash's future prospects.