Mizuho Securities analysts raised their price target on DoorDash (NASDAQ:DASH) to $120.00 from the previous $105.00, while reiterating their Buy rating for the stock.

The analysts noted that DoorDash continues to expand its market share, benefiting from favorable unit economics due to rational competition, an increased labor supply, and higher network density. They also observe the potential for continued margin growth, driven by reduced acquisition costs for dashers and customers, as well as disciplined spending on fixed costs.

Furthermore, the analysts suggest that strong operating leverage, coupled with limited market expansion, positions DoorDash to potentially achieve an EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) in fiscal year 2024 that could exceed consensus estimates by nearly 20%. This assumption is based on the premise that the incremental EBITDA margins will remain at the same level as in fiscal year 2023.
As a result of this analysis, the analysts raised their EBITDA forecast for fiscal year 2025 by 13%, reaching $2.4 billion.

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