3 Red Flags for DoorDash's Future

DoorDash's (NYSE: DASH) stock closed at an all-time high of $245.97 last November. But today, the food delivery company's shares trade at about $70 -- more than 30% below its IPO price of $102 in December 2020.

DoorDash lost its luster for two simple reasons. First, its growth cooled off in a post-lockdown world as people started dining out again. Second, rising interest rates drove investors away from unprofitable growth stocks which were trading at unsustainable valuations. DoorDash remains unprofitable on a GAAP (generally accepted accounting principles) basis, and it was trading at 17 times its 2021 sales at its peak valuation last November.

Image source: DoorDash.

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Source Fool.com