Is It Too Late To Consider DoorDash After Its 363% Three Year Share Price Surge

• Wondering if DoorDash is still worth buying after its big run, or if the easy money has already been made? You are not alone.
• The stock has climbed 3.5% over the last week, 23.9% in the past month, and is now up 37.6% year to date, building on a 38.2% gain over 1 year and an eye catching 363.4% over 3 years.
• These moves have been fueled by ongoing optimism around food delivery demand and the company pushing deeper into categories like groceries, convenience, and retail. Investors see these areas as opening up a much larger addressable market. At the same time, heightened regulatory debates over gig worker classification and delivery fees have kept a layer of risk in the background that the market is constantly repricing.
• Despite all that momentum, DoorDash only scores a 2/6 valuation check score, suggesting it screens as undervalued on just a couple of traditional metrics. The real question is which valuation approaches actually matter for a business like this, and whether there is a smarter way to judge its true worth that we will unpack by the end of this article.

DoorDash scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: DoorDash Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a business is worth today by projecting its future cash flows and then discounting those projections back into present dollars. For DoorDash, the model uses its last twelve months Free Cash Flow of about $2.0 billion as a starting point, with analysts and extrapolated estimates pointing to Free Cash Flow of roughly $9.7 billion by 2035.

These projections blend analyst forecasts for the next few years with Simply Wall St’s longer term assumptions. They reflect expectations that DoorDash will keep scaling both revenue and margins as it grows beyond restaurant delivery into groceries and retail. Using a 2 Stage Free Cash Flow to Equity approach, the DCF model arrives at an intrinsic value of about $301.52 per share.

That fair value implies the stock is trading at roughly a 22.1% discount, suggesting the market is still skeptical that DoorDash can fully deliver on these cash flow expectations.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests DoorDash is undervalued by 22.1%. Track this in your watchlist or portfolio, or discover 899 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for DoorDash.

Approach 2: DoorDash Price vs Earnings

For profitable businesses like DoorDash, the price to earnings ratio is a useful yardstick because it links what investors are paying directly to the company’s bottom line. A higher PE can be justified when the market expects strong, durable earnings growth and sees relatively low risk, while slower growth or higher uncertainty usually calls for a lower, more conservative multiple.

DoorDash currently trades on a lofty PE of about 117.3x, far above the Hospitality industry average of roughly 22.0x and even ahead of its high growth peer group at around 35.5x. Simply Wall St’s proprietary Fair Ratio model estimates that, given DoorDash’s growth outlook, margins, size and risk profile, a more reasonable PE would be closer to 50.3x. This Fair Ratio goes beyond simple peer or industry comparisons by explicitly adjusting for company specific factors like earnings momentum, business quality, and volatility.

Stacking the current PE of 117.3x against the Fair Ratio of 50.3x implies the stock is pricing in far more optimism than the fundamentals justify right now.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1458 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your DoorDash Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, which are simply your story about a company, tied directly to your estimates for its future revenue, earnings, margins, and ultimately what you believe is a fair value per share.

On Simply Wall St’s Community page, Narratives let you connect DoorDash’s business story, such as global grocery expansion or regulatory risk, to a concrete financial forecast and then to a clear fair value that you can compare against today’s share price to decide whether it looks like a buy, a hold, or a sell.

Because Narratives are updated dynamically as news, earnings, or guidance changes, your fair value view automatically evolves with the latest information instead of being locked to a static model.

For example, one DoorDash Narrative on the platform might assume rapid global expansion and margin gains and land on a fair value near $360 per share, while a more cautious Narrative focused on regulatory and competitive pressures might see fair value closer to $205, showing how different yet disciplined perspectives can coexist around the same stock.

Do you think there's more to the story for DoorDash? Head over to our Community to see what others are saying!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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