At the end of the third quarter, DoorDash was collaborating with “over 40,000 non-restaurant stores.” As the company partners with retailers whose margins are much higher than those of restaurants, DoorDash’s own margins should climb meaningfully.ĭoorDash is also expanding to new international markets. Meanwhile, DoorDash continues to expand the number of companies aside from restaurants with which it’s partnering. Walmart (NYSE: WMT), for example, recently began its first-ever multi-city test of such vehicles in partnership with Ford’s (NYSE: F) subsidiary, Argo. The day when many large merchants are ready to use autonomous vehicles may not be that far away. In the longer term, the proliferation of autonomous vehicles could greatly boost DoorDash’s top and bottom lines. According to Bloomberg, GrubHub’s owner, Just Eat Takeaway (NASDAQ: GRUB), is considering selling the American food delivery company.Īs the number of competitors in the delivery sector drops, it should become easier for DoorDash to charge merchants much higher fees. And one of its major competitors, GrubHub, could be acquired by another large company in the sector. Other Upbeat Catalysts for DASH StockĪs the pandemic eases, costs climb and lockdowns disappear, many, if not most, of DoorDash’s small competitors are likely to go out of business. That’s not a very high valuation for a company that’s growing fairly rapidly and whose core business generated positive cash flow through the first nine months of last year. On the valuation front, the enterprise-value-to-sales ratio of DASH stock, based on analysts’ average 2022 revenue estimate, is now roughly 7x. The most important point is that, in the first nine months of 2021, DoorDash’s core business was profitable from a cash-flow standpoint.

Still, there were many more lockdowns in 2020 than in 2021, and costs rose for most businesses last year.

That was well below the $304 million of cash from operations, excluding SBC, the firm reported in the first none months of 2020.

Even more impressively, DoorDash’s cash flow from operations was $525 million in the first nine months of 2021, up from $315 million in the same period in 2020.Įven excluding the $357 million of stock-based compensation (SBC) that DoorDash paid out between January 2021 and September 2021, it generated cash from its operations of $168 million. In the first nine months of 2021, DoorDash’s sales jumped to $3.59 billion, up from $1.92 billion during the same period in 2020.

Dash stock lockup