The stock is up over 70% since last July, so the question for investors is if there is more on the menu for 2025. With last quarter's earnings serving up impressive growth and analysts raising their estimates, the table is set for a tasty year ahead.
Headquartered in San Francisco, DoorDash operates a logistics and technology platform that connects merchants, consumers, and independent contractors (Dashers) in the United States and internationally. Its primary offering, the DoorDash Marketplace, serves over 37 million monthly active users, facilitating the purchase and delivery of goods from local merchants.
DoorDash provides services like customer acquisition, order fulfillment, payment processing, and customer support, while also offering merchants advertising opportunities to grow sales. Its platform also includes features for managing employee payroll, tips, and scheduling, as well as robust reporting and analytics tools to help restaurants drive data-driven decisions.
In 2023, DoorDash generated $2.303 billion in revenue, facilitated 2.16 billion orders, and achieved a gross order volume of $66.77 billion, reflecting strong year-over-year growth. Founded in 2013 and formerly known as Palo Alto Delivery Inc., DoorDash completed its IPO in December 2020.
The stock has a Zacks Style Score of "A" in Growth and Momentum. However, the company has a Forward PE of 86, giving the stock a Style Score of "F" in Value.
On October 30th, the company reported an 80% EPS beat, helping the stock move over 15% higher in the following weeks.
The standout Q3 performance, showcased DoorDash's robust growth and profitability milestones that underscore its strength and long-term potential. The company reported earnings of $0.38 per share, a 300% improvement from a loss of $(0.19) per share in the same period last year. Quarterly revenue surged 25% year-over-year to $2.706 billion, exceeding the consensus estimate of $2.660 billion. Total Orders grew 18% to 643 million, while Marketplace Gross Order Volume (GOV) climbed 19% to $20 billion, driven by increased consumer engagement and expanding user growth.
DoorDash achieved positive GAAP net income for the first time since going public, reflecting its commitment to sustainable growth and operational excellence. The company emphasized its strategy of reinvesting in services and innovation to support local merchants and expand local economies.
While the valuation will keep some investors away, analysts see growth ahead and are raising earnings estimates. Since Q3 earnings were reported back in October, revisions to earnings have gone higher across all time frames.
For the current quarter, estimates have gone from $0.19 to $0.33 over the last 90 days. This is a 73% jump, with next quarter seeing a 100% move higher, going from $0.18 to $0.36.
For the current year, estimates have been taken from -$0.03 to $0.26 over that same time frame. For next year, analysts now see $1.94, up 42% from the $1.37 expected 90 days ago.
Analysts also took their price targets higher, with most price targets ranging from $160-190. Most of these targets have been hit with the stock already printing $181 in December.
More recently firms such as Citigroup, JMP, RBC and Truist have posted price targets over $200. If the company can perform on earnings when it reports in February, the upward momentum should continue.
The stock has seen a slow move higher since August, which has taken the stock from just over $100 to $180. This is a big move in just half a year, so naturally investors are starting to take some profits.
The stock has pulled back off last year's highs, so let us look at some buyable support levels.
21-day Moving Average: $173
50-day MA: $170
200-day: $136
Fibonacci buy zone (50%-61.8% retracements): $132-141
It would take a large pullback in the markets or an earnings disappointment to retrace back down to that $130-40 area. While that 200-day might be out of reach, investors could start to build positions at those higher levels.
DoorDash continues to deliver impressive growth and strong financial performance, positioning itself as a leader in the food delivery and logistics industry. With a robust platform connecting millions of users and merchants, the company's innovative approach to driving engagement and supporting local economies sets it apart.
Analysts are increasingly bullish on DoorDash's prospects, as reflected in upward earnings revisions and elevated price targets, some exceeding $200. While valuation concerns may deter value-focused investors, the company's growth trajectory, profitability milestones, and strong technical support levels make it an appealing option for those seeking momentum in their portfolios.
Caesars Entertainment is a Zacks Rank #5 (Strong Sell) that operates a wide range of entertainment and hospitality businesses, primarily in the casino and resort sectors.
The company owns and operates casinos, hotels, and resorts, offering various gaming experiences, entertainment options, dining, and nightlife. Caesars is known for its flagship brands like Caesars Palace in Las Vegas, as well as other properties across the U.S. and internationally.
While the brand is one of the more popular names in Vegas, the stock is trading near 2024 lows. Investors should stay away after A streak of earnings misses and falling estimates
Caesars Entertainment, based in Reno, Nevada, is a diversified gaming and hospitality giant with roots dating back to 1973 when it was founded by the Carano family. The company primarily generates revenue through its expansive gaming operations, which include mobile and online gaming as well as sports betting.
Operating under renowned brands such as Caesars, Harrah's, Horseshoe, and Eldorado, the company has a significant presence in the United States and five other countries.
CZR is valued at $7 billion and has a Forward PE of 26. The stock holds Zacks Style Scores of "B" in Value, but "F" in Growth.
October brought the fourth straight EPS miss, with the company posting a surprise miss of 120%. Caesars reported Q3 quarterly sales of $2.90 billion, slightly below the analyst consensus estimate of $2.92 billion, missing by 0.82%. The sales represent a 3.14% decline compared to the $2.99 billion reported in the same period last year.
Caesars wasn't the only name that struggled as several major Las Vegas casino operators reported financial results that fell short of expectations, highlighting operational weaknesses.
MGM Resorts saw a significant revenue decline in its Las Vegas operations, with notable drops in table games earnings. Wynn Resorts experienced reduced casino revenue despite growth in entertainment and retail sales, while Las Vegas Sands faced a decrease in total quarterly revenue due to ongoing renovations and lower-than-expected property income.
These challenges reflect issues such as decreased casino patronage, operational disruptions, and changing consumer behavior, impacting the financial performance of these operators.
With earnings and industry weakness, analysts are lowering their estimates for Caesars.
Over the last 90 days, numbers have been taken down 74% for the current quarter, going from $0.27 to $0.05.
For the current year, we see the losses increasing, with earnings estimates going from -$0.68 to -$1.28. Next year also sees a 28% drop, going from $1.70 to $1.23.
2024 was a long year for investors in CZR. The stock dropped about 30% and has started the year around the 2024 lows.
While the fundamental story needs work, the technical side looks bad as well. The stock is trading below all its moving averages; the first positive sign for the bulls would be a move over the 21-day MA, currently at $35.
From there, the resistance area is the 200-day at $38. However, the stock has just seen a "Death Cross," which is when the 50-day falls below the 200-day MA. This is typically a negative signal.
Caesars Entertainment faces significant challenges that make it an unattractive investment at this time. Despite its strong brand presence and diverse operations in the gaming and hospitality sectors, the company is grappling with a streak of earnings misses, declining revenues, and reduced earnings estimates.
During the initial phase of the pandemic, when vaccines were unavailable, the world faced significant uncertainties. Crude oil prices experienced an unprecedented plunge, dropping to a negative $36.98 per barrel on April 20, 2020. However, the rapid development and rollout of vaccines facilitated the gradual reopening of economies, leading to a remarkable recovery in the pricing of West Texas Intermediate (WTI) crude, which soared to $123.64 per barrel by March 8, 2022. Oil price data are per the U.S. Energy Information Administration.
Currently, WTI crude oil is trading at more than $70 per barrel. This highlights the inherent exposure of most energy companies to extreme volatility in commodity prices. Therefore, it is prudent for investors to keep an eye on midstream stocks, such as Kinder Morgan, Inc., MPLX LP and The Williams Companies, Inc..
Although the fate of energy players is highly dependent on oil and gas prices, stocks in midstream space have lower exposure to volatility in commodity prices than oil and gas producers. This is because midstream players generate stable fee-based revenues since the transportation and storage assets are being booked by shippers for the long term. Hence, their business model is relatively low-risk, which indicates considerably less exposure to oil and gas prices and volume risks.
We have employed our Stock Screener to zero in on three stocks belonging to the midstream energy space that are well-poised to gain, and hence, investors should keep an eye on these stocks. All the stocks carry a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Kinder Morgan: With its operating interests in oil and gas pipeline networks spread across 83,000 miles, KMI is a leading energy infrastructure company in North America. It derives most of its earnings from take-or-pay contracts, generating stable fee-based revenues.
Kinder Morgan is poised to grow due to its business model, which is relatively resilient to volume and commodity price risks. These positive developments are reflected in the stock's upward earnings estimate revisions for 2025 in the past 30 days.
MPLX: The firm has ownership and operating interests in midstream energy infrastructure and logistics assets, generating stable cashflow. The partnership has a strong focus on returning capital to unit holders. Under its unit repurchase authorization, the partnership has yet to buy back the remaining $620 million of its units. In 2025, MPLX will likely see earnings and sales growth of 2.4% and 4.5%, respectively.
The Williams Companies: It is well-poised to capitalize on the mounting demand for clean energy since it is engaged in transporting, storing, gathering and processing natural gas and natural gas liquids.
With its pipeline networks spread across more than 30,000 miles, The Williams Companies connects premium basins in the United States to the key market. WMB's assets can meet 30% of the nation's natural gas consumption, which is utilized for heating purposes and clean-energy generation. These positive developments are reflected in the stock's upward earnings estimate revisions for 2025 in the past 30 days.
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