© Reuters. GoDaddy (GDDY) rating raised as Piper Sandler sees opportunity for positive growth revisions
Piper Sandler analysts upgraded shares of GoDaddy (NYSE:) to Overweight from Neutral, raising its price target to $121 from $100 per share in a research note to clients covering commerce tech on Tuesday.
The price target was lifted based on a lower discount rate and higher terminal FCF multiple (DCF).
In the note, the firm said 2023 was another challenging year for Commerce Tech. Still, looking to 2024, analysts see an opportunity for positive growth revisions in their higher-quality names without losing progress on profitability.
“Now, with margins playing out quickly enough to position GDDY for a 29% NEBITDA margin exit rate in 2023E & 8% Domains bookings growth in last quarter; we are at a place where we can really believe in a reacceleration to HSD growth in FY24 with 30%+ NEBITDA margin,” the analysts said.
They added that this could finally reverse a five-year trend of multiple compression at GDDY.
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