GoDaddy Inc (NYSE:GDDY) Price Target Raised to $186 by Benchmark - Is It a Buy?
Benchmark, a renowned financial analyst firm, has updated its outlook on GoDaddy Inc (NYSE:GDDY) and raised the price target on the company's shares to $186 from $170, maintaining a Buy rating. The adjustment reflects a valuation set at 19.5 times the estimated 2025 Enterprise Value to Free Cash Flow (EV/FCF), a 25% increase over the average EV/FCF multiple from 2020 to 2022.
The revision comes after a virtual Non-Deal Roadshow (NDR) with GoDaddy's Chief Financial Officer, Mark McCaffrey, where key insights were shared, complementing the information from GoDaddy's second-quarter financial report.
Benchmark's updated price target is influenced by GoDaddy's Free Cash Flow per Share (FCF/share) Compound Annual Growth Rate (CAGR) target for the years 2024 to 2026. The firm remains positive on the stock, aligning the new price target with GoDaddy's growth trajectory and financial targets.
GoDaddy Inc, a leading internet domain registrar and web hosting company, reported robust Q2 earnings with a 7% increase in total revenue to $1.1 billion. RBC Capital Markets responded by raising its price target from $145 to $175, maintaining an Outperform rating on the shares.
Despite a net debt of $3.4 billion, GoDaddy remains optimistic about its AI initiatives, reflecting the company's commitment to innovation and delivering value to shareholders.
Analysis:
- GoDaddy Inc's stock price target has been raised to $186 by Benchmark, indicating a positive outlook on the company's growth trajectory.
- The company reported strong Q2 earnings, with a 7% increase in total revenue, prompting RBC Capital Markets to raise its price target to $175.
- Despite having a net debt of $3.4 billion, GoDaddy remains committed to innovation and global expansion.
- Investors should consider GoDaddy's solid financial performance, with a robust revenue growth of 5.91% over the last twelve months and a gross profit margin of 63.16%.
- The lack of dividend payments may influence income-focused investors, but the company's high return over the last year at 127.14% total price return is noteworthy.
Overall, GoDaddy Inc's positive financial performance and growth prospects make it an attractive investment opportunity for those seeking stable returns and long-term growth potential.