Door Dash delivery service claims to be a global leader
Expanding the list of services provided can make the delivery service DoorDash Inc. (DASH) one of the most influential companies. DoorDash started its activity exclusively as a specialist in the delivery of food from restaurants.
However, several recent acquisitions and partnerships have expanded the list of goods available for delivery and the geography of presence. For example, in early November, DoorDash acquired for $8 billion the Finnish company Wolt, providing delivery in 23 countries. It was a valuable acquisition since Wolt operates mainly in those regions (Europe, Japan, Kazakhstan, and Azerbaijan) where DoorDash is not yet present, and the positions of other global deliverers are not very strong.
The advantage of the Wolt platform is the ability to access local restaurants and grocery stores most efficiently, from which it can deliver food as quickly as possible. The acquisition of Wolt shows how seriously DoorDash takes the expansion of market share and the list of available services.
The company’s customers can order food, everyday goods, alcohol, pet food, and much more, even from small shops in their locality. The deliverer implements a strategy: serve as many suppliers as possible with delivery services and reach as many customers as possible with your application.
So far, the risk for DoorDash is possible problems with creating an uninterrupted delivery system. The company needs to make a large staff of drivers who are ready to provide high-quality services. Due to the difficulties in implementing this task, the company is still incurring losses, as it has to invest a lot in software and monitoring systems.
Therefore, it is not surprising that DoorDash is interested in building a delivery network using cars with automatic driving systems. In early November, after the acquisition of Wolt, many Wall Street analysts raised their forecasts for DoorDash shares. So, RBC Capital Mkts set a recommendation “above the market” and raised the target price to $260.
Needham experts recommend buying shares, assuming that the price will rise to $ 270. BofA Securities adheres to a similar forecast. At the auction on November 25, DASH stock was worth $184.93.
