Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

DoorDash surges on $8 billion takeover deal to jump start international expansion

Stock MarketsNov 10, 2021 08:15AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A delivery person for Doordash rides his bike in the rain during the coronavirus disease (COVID-19) pandemic in the Manhattan borough of New York City, New York, U.S., November 13, 2020. REUTERS/Carlo Allegri/File Photo

(Reuters) - Shares of DoorDash Inc jumped 16% on Wednesday after the U.S. food delivery firm inked an $8 billion deal to buy Finnish startup Wolt to grab a slice of the European market and maintain its blistering pace of growth.

The deal will help DoorDash enter 22 new markets, including Germany, Denmark and Sweden, while potentially serving about 700 million customers.

"(The move) jump starts international expansion," BTIG analyst Jake Fuller said, adding that if it were not for the acquisition, it would have taken DoorDash much longer to reach international markets through "an organic build-out."

At least eight brokerages cheered the deal by raising their price targets on the stock. Evercore analysts said a challenge for DoorDash prior to the deal was its lack of international presence.

The takeover is expected to help DoorDash maintain its growth momentum seen during the pandemic. Analysts are estimating a 65% surge in revenue this year, according to Refinitiv data.

"This partnership is really about acceleration and expansion, to play for a bigger prize on an even larger global stage," DoorDash Chief Executive Officer Tony Xu said on a conference call on Tuesday.

Through the all-stock deal, Wolt - which made its first delivery in Helsinki, Finland in 2015 - would be valued at about three times its expected gross order value of $2.5 billion

"(The deal) speaks volumes that DoorDash would rather buy a sector challenger for more than its own trading multiple than to acquire incumbents at one-third of the valuation," Jefferies (NYSE:JEF) analysts said.

DoorDash shares, which have nearly doubled since their initial public offering in December, were trading at $223.50 before the bell.

DoorDash surges on $8 billion takeover deal to jump start international expansion
 

Related Articles

Wall Street rallies on back of big tech, banks
Wall Street rallies on back of big tech, banks By Reuters - May 23, 2022 42

By Stephen Culp NEW YORK (Reuters) - U.S. stocks ended higher on Monday as gains from banks and a rebound in market-leading tech shares supported a broad-based rally following...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email