DoorDash shares were up 9% premarket; however, some retail investors warned of potential profit-booking ahead of the market open.
DoorDash (DASH) shares surged 9% in premarket trading on Thursday after the company reported strong quarterly results and a forecast, but retail investors warned of potential profit booking in the regular session.
Shares were even higher in Wednesday’s after-market trading, and a retail trader on Stocktwits noted at the time that, should the gains hold, DoorDash would be valued at par with FedEx (FDX) and United Parcel Service (UPS) combined.
As of the last close, DoorDash was valued at $109.36 billion, while the combined market cap of the two legacy courier companies was $126.46 billion, according to TradingView.
On Stocktwits, the retail sentiment for DASH shifted to ‘extremely bullish’ as of early Thursday, from ‘bullish’ the previous day, with message volume rising over 200% in the past 24 hours.
Users generally posted positive comments about the results, which exceeded Wall Street’s expectations, albeit with a cautionary note.
“$DASH Huge profit taking at open just like last time. This will dump 10 points in seconds,” one said.
“Parabolic moves get noticed and punished at open. Take your profits and run!” another said.
DoorDash reported second-quarter results that beat the Street’s expectations for revenue, adjusted profit, and gross merchandise value (GMV), and also forecast Q3 GMV higher than expectations.
The results show robust demand for food delivery services, particularly in its main markets such as the U.S. and Canada. To its credit, DoorDash has also broadened its delivery offerings beyond food recently to include groceries, alcohol, electronics, and beauty items, helping it drive up orders.
Rival Uber Eats’ parent Uber (UBER.N) also forecast a strong third quarter earlier in the day, banking on robust demand for ride-hailing and deliveries.
The results come close on the heels of major acquisitions. In May, DoorDash acquired British food delivery startup Deliveroo for about $3.9 billion and restaurant technology company SevenRooms for $1.2 billion.
DoorDash’s shares have risen 54% year-to-date. If the pre-market move holds in Thursday’s session, it would be the stock’s best performance in about four months.
For updates and corrections, email newsroom[at]stocktwits[dot]com.