DoorDash Stock Dragged to Record Low After Earnings

No fewer than eight analysts slashed their price targets

Deputy Editor
May 6, 2022 at 10:41 AM
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DoorDash Inc (NYSE:DASH) is plummeting to record lows today, reversing its premarket gains. At last glance, the stock was down 11.2% at $64.93, and was earlier as low as $63.11, after the food delivery app's mixed first-quarter report. DoorDash turned in losses of 48 cents per share -- wider than analysts' anticipated losses of 41 cents per share -- though revenue of $1.46 billion beat estimates of $1.38 billion. So much for all of that positive post-earnings history!

No fewer than eight analysts slashed their price targets after the event. The lowest cuts came from RBC and UBS, with both firms lowering theirs to $94. Now, the 12-month consensus price target of $140.90 is a whopping 116.8% premium to current levels. Of the 16 analysts in coverage, eight carry a "buy" or better rating, while the the other half say "hold."

On the charts, DASH has been on a long tear lower, eyeing its third-straight week in the red with pressure at the 80-day moving average. Since the start of the year, the equity is down 56.4%. The stock's low valuation could put it on track for a short-term bump, however, as its relative strength index (RSI) of 19.2 is firmly in "oversold" territory.

At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), puts have been much more popular than usual in the options pits over the last 10 weeks. This is per DASH's 50-day put/call volume ratio of 1.77, which sits higher than 99% of readings from the past year. 

That bearish sentiment is continuing today, though it's worth noting that the stock has landed on the Short Sale Restricted (SSR) list amid its negative price action. So far, 18,000 puts have crossed the tape, compared to 8,832 calls, with overall options volume running at five times the intraday average. The May 70 put is the most popular, followed by the weekly 5/6 56-strike put, which expires today. 

 

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