Gary Black
Co-Founder & Portfolio Manager of The Future Fund
DoorDash should recover from its post-earnings dip given strength in orders, revenue and EBITDA. Q2 marketplace GOV rose 36% to $33.1B, revenue was $4.45B versus $4.34B expected, adjusted gross margin 54.2% versus 51.8% and adjusted EBITDA $914M versus $843.4M. Q3 EBITDA guidance of $950M-1.1B brackets the $982.2M estimate. EPS of $0.46 missed $0.48 and free cash flow was light, on higher costs tied to more orders. x.comÂ
DoorDash looks compelling at 33x 2026 earnings and 19x 2026 EV/EBITDA against expected five-year forward growth of 20% a year in revenue and 25% in EBITDA. Second-quarter guidance beat: marketplace gross order value of $32.4-33.4B versus $32.25B expected, after first-quarter GOV rose 37% to $31.6B and EPS of 42 cents topped the 37-cent estimate. DoorDash expects Deliveroo to add about $200M of adjusted EBITDA in 2026, and Q2 EBITDA guidance absorbs a $50M Dasher gas relief program. x.comÂ
DoorDash's clear accumulation makes its continued selloff look unjustified. The stock is still falling despite that buying. x.comÂ
American demand for delivery makes DoorDash hard to bet against despite reports it may acquire Instacart. Analysts target over $250 against a $169 share price. x.comÂ
DoorDash's EPS beat is mostly tax-driven, and the apparent discount on its Instacart purchase will take time to matter. Despite a strong quarter, $1.06 GAAP EPS at a 3.9% tax rate would be about $0.85 at 23%, roughly in line with consensus; organic GOV growth stayed at 23%. DoorDash is paying 11.7x annualized Q3 EBITDA for Instacart versus its own 16x multiple, but the $17B deal won't close until late 2027 or 1H28, and management plans to reinvest more than 100% of first-year synergies. x.comÂ
DoorDash is building the local infrastructure layer of a three-sided marketplace for all of local commerce, so heavy investment is expected and does not break the thesis. It is an incredible growth business run by excellent operators with an unlimited addressable market. Selling on worries about competitive intensity, earnings quality or the direction of the numbers misreads that. x.com x.comÂ
DoorDash is a bet on human laziness, which is foolproof. Per The Kobeissi Letter, the stock jumped over 15% after 33% year-over-year revenue growth and strong guidance. x.comÂ
DoorDash may be seeking acquired growth because its market share looks to have peaked. Its interest in buying Instacart looks desperate given its poor platform, adding to the short-DoorDash side of the long-Uber pair. x.comÂ
Potential buyout news involving DoorDash could fuel substantial upside for Instacart. It is finally starting to break out, and could easily double from here. x.comÂ
DoorDash's earnings per share are estimated to nearly quintuple over the next three years, from $2.62 in 2026 to $12.30 by 2029, an insane inflection. AI and autonomous delivery by robots and drones could add another major margin lever over time. x.com x.comÂ
DoorDash looks expensive against its cash earnings, at 68x trailing and 50x next year's, versus about 20x for retailers. A fair value of $87.02-$110.75, or 20x next year's cash earnings give or take 12%, puts the price about 110% above fair, and even that leans on a forecast 31% above the trailing figure. This is a levels-only read from reported earnings and revenue estimates, not fundamental work. x.comÂ
DoorDash's core business is fine and its investments make sense; the problem is a tough narrative, so below $160 it is probably fine to own for anyone not judged on monthly performance. The tape is unforgiving: investors keep asking about FY27 though management would never guide that far out, and investor relations has brushed off calls for an analyst day and tough questions on the investment cycle. x.com x.com x.comÂ
