Wedbush Analyst Sees Buying Opportunities in Booking Holdings and DoorDash Despite market Concerns
New York, NY – November 21, 2023 – Leading financial analyst Scott Devitt of Wedbush has issued upgraded ratings for two prominent companies in the travel and food delivery sectors: Booking holdings (BKNG) and DoorDash (DASH). The moves, announced today, signal a bullish outlook despite recent market fluctuations and investor anxieties surrounding spending initiatives. This analysis delves into the reasoning behind Devitt’s upgrades, contrasting his viewpoint with AI-driven forecasts and examining the potential for long-term growth.
Booking Holdings: A Solid Foundation for Continued Growth
Booking Holdings, the parent company of Priceline and Kayak, has demonstrated robust performance, evidenced by strong third-quarter results featuring double-digit gains in both gross bookings and revenue. This positive momentum has prompted Devitt to elevate his rating on BKNG from “hold” to “buy,” accompanied by a ample price target of $6,000. This represents a importent vote of confidence in the company’s future prospects.
“Booking remains the best-positioned Online Travel Agency (OTA) in our view,” Devitt stated, highlighting the company’s inherent strengths. These include its extraordinary scale, diversified portfolio of brands, strong liquidity position, and efficient free cash flow generation.
Beyond the current financial health,Devitt emphasized management’s consistent track record of successfully implementing major strategic initiatives. He specifically pointed to Booking Holdings’ expanding market share in the rapidly growing choice lodging segment, coupled with a commitment to cost optimization and operational efficiencies. These cost savings aren’t simply bolstering the bottom line; they are being strategically reinvested into growth initiatives designed to deliver long-term value.
The analyst also noted that Q3 gross bookings growth of 14% exceeded management’s guidance by a considerable margin (400 basis points). This positive surprise led Devitt to raise his 2025 gross bookings growth estimate to 11.5%, a 100 basis point increase from his previous forecast. He anticipates adjusted EBITDA of $9.8 billion, reflecting a year-over-year margin expansion of approximately 180 basis points.
Contrasting Views: Analyst vs. AI
While Devitt’s outlook is decidedly positive, it’s critically important to note a divergence in opinion. TipRanks’ AI Analyst currently maintains a “neutral” rating on Booking Holdings, with a slightly lower price target of $5,406. This illustrates the inherent complexities of market analysis and the value of considering multiple perspectives. Devitt himself ranks among the top 660 analysts tracked by TipRanks, boasting a 50% success rate with an average return of 12.3% – a testament to his informed judgment.
(You can view Booking Holdings’ financials on TipRanks here: https://www.tipranks.com/stocks/bkng/financials)
DoorDash: Investing in the future of Food delivery
devitt’s bullish sentiment extends to DoorDash (DASH), the leading food delivery platform. He upgraded his rating from “hold” to “buy” with a price target of $260, despite recent market reaction to the company’s third-quarter earnings report and announced investment plans.
doordash shares experienced a dip following the earnings release, largely due to concerns surrounding planned capital expenditures of “several hundred million dollars” in 2026. However, Devitt views this pullback as a compelling buying opportunity. He argues that the current valuation – approximately 17.7x his 2027 adjusted EBITDA estimate – presents an attractive risk/reward profile.
“The post-earnings selloff was primarily driven by concerns about capital spending and its impact on profit margins,” Devitt explained. While acknowledging the near-term impact on margins, he firmly believes that these investments are crucial for expanding DoorDash’s addressable market and enhancing its product offerings.
Strategic Investments in Key Growth areas
Devitt highlighted three key areas where DoorDash intends to focus its investments:
- Global Tech Platform: Building a cohesive and scalable technology infrastructure to support international expansion and future innovation.
- New Verticals & Products: Expanding beyond customary restaurant delivery to include grocery, convenience items, and other on-demand services.
- Geographic Expansion: Extending DoorDash’s reach into new markets, both domestically and internationally.
Devitt remains confident
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