Communications
One thing that has seemingly gone unnoticed is that DASH’s take-rate has been topping out on a sequential basis since 2Q23. Hesham Shaaban believes DASH had been reinvesting subscription revenues into promos (revenue offsets) to drive GOV growth. But DASH ended 2023 with only 20% more subs on a y/y basis (vs. 50% in 2022), so it is working with less incremental subscription revenue to offset the promos needed to buoy an even larger GOV basis this year. Collectively, this suggests that take-rates may be under pressure; he is expecting take-rates to flatten out if not decline on a sequential basis this year, while consensus is assuming consistent expansion through 4Q24. Hesham is eyeing 4Q24 for an EBITDA miss on guidance, but suspects 3Q24 GOV or EBITDA guidance could come in light as well.
Edition: 189
- 28 June, 2024
Communications
Having successfully shorted DASH several times in 2022, Tom Chanos turns bearish once again. The stock has gained more than 200% off the low price of $43 in Oct 2022 and is up 125% in the past year. However, with short interest now less than 4%, Tom says there are no shorts left to squeeze, just as the business begins to slow dramatically. He argues Wall Street estimates are far too bullish and by the time DASH reaches breakeven it will have pedestrian top line growth at best. No one pays 100x EPS for single digit growth. A 40x multiple would be very generous which would put the stock at $45.
Edition: 182
- 22 March, 2024
Communications
DASH reported 3Q23 results that beat consensus but much of this outperformance can be attributed to low-balling forecasts. Furthermore, BTN questions how much of the gain can be sustained given the size of the cuts to key expenses. Adjusted EBITDA was $74m ahead of the high end of guidance, but to get there the company added back an additional $30m in litigation costs, had a sudden $50m drop in G&A costs, a large decrease in advertising, and it appears that employee pay increases have stalled and R&D is flat-to-down. These boosts to EBITDA filter down to earnings. In addition, earnings benefitted from interest income rising by $31m.
Edition: 173
- 10 November, 2023
DoorDash (DASH)
Communications
Clear case to be made that DASH can rise from an upstart restaurant ordering/delivery company into an empire spanning Restaurants, Convenience, Grocery and other CPG categories. Hedgeye believe that the company can easily exceed $70bn in Marketplace GOV in FY24, up over 80% from $37bn in FY21. Their bullish thesis also includes DASH’s opportunity to monetise DashPass (compares it to Amazon Prime/Starbucks Rewards) and its potential to capture substantial market share in the digital advertising space.
Edition: 113
- 25 June, 2021
Just Eat Takeaway.com (TKWY NA) Netherlands
Communications
Faces increased competition as Rocket enters the Dutch market and DoorDash targets Germany, another of TKWY’s key markets. To maintain market share, TKWY was already shifting further towards the loss-making own delivery side of the business. Now, with Rocket focused on marketplace revenues (offering lower commissions to restaurants to boost market share), TKWY is also being attacked on the cash generating side. These latest developments only strengthen Teun Teeuwisse's short thesis.
Edition: 112
- 11 June, 2021
Post-Pandemic Model Portfolio’s outperformance continues
Since inception (31st Dec 2020) Nathan Weiss’ model portfolio has generated an impressive +25.09% total return (vs. +11.12% for S&P 500). He is currently 38.3% net long the energy sector (incl. Kayne Anderson Energy Infrastructure, ChampionX, Energy Transfer LP); 17.1% net long ‘re-opening’ names (incl. Dave & Buster’s, Six Flags) and 29.6% short ‘stay at home enablers’ (incl. Stitch Fix, ARK Next Generation Internet, Etsy, Wayfair). He recently increased his short position in DoorDash - sees >50% downside in a matter of months.
Edition: 111
- 28 May, 2021