Online food ordering and delivery platform DoorDash, Inc. (NYSE:DASH) recently revealed that it has entered into a definitive agreement to acquire Bbot, a hospitality technology startup. The financial terms of the deal have not been disclosed so far.
Following the news, shares of the company declined 2.4% on Tuesday. The stock pared its losses slightly to close at $102.56 in the extended trading session.
With this acquisition, DoorDash aims to provide restaurateurs and food and beverage venue operators more solutions for their in-store and online channels.
Following the closure of the deal, Bbot’s in-store digital and online ordering solutions will be available to merchants for no monthly subscription fee through August 31, 2022.
The Chief Revenue Officer of DoorDash, Tom Pickett, said, “We’re excited to bring our combined suite to an even wider selection of merchants across the hospitality space – including bars, hotels, and ghost kitchens – so these businesses can engage with more customers, increase their quality of service, and grow sales. Bbot has built best-in-class features and highly customizable tools that will enable DoorDash to better support the ever-growing range of merchant needs.”
Recently, D.A. Davidson analyst Tom White reiterated a Hold rating on the stock. The analyst, however, lowered the price target from $210 to $135, which implies upside potential of 31.8% from current levels.
According to the analyst, the company’s operating margins face challenges due to investments in new marketplaces and international expansion.
Overall, the Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 9 Buys and 7 Holds. The average DoorDash stock prediction of $164.21 implies that the stock has upside potential of 60.3% from current levels. Shares have declined 36.2% over the past year.
News Sentiment for DASH is Neutral based on 18 articles over the past seven days. 100% of the articles have Bullish sentiment, compared to a sector average of 64%.
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