MoffettNathanson downgraded DoorDash Inc (NYSE:DASH) to Market Perform, with a new price target of $93, down from $110 in a note Friday.
Analysts there told investors that they are downgrading the stock based on student loan risks.
"What happens when 43 million Americans see an average of $225/month come out of their pockets in October? If we've learned one lesson in economics class: there's no free lunch," the analysts wrote.
The analysts referred to the fact that we are now approaching the end of the student loan suspension, which, during the pandemic, had meant a "new consumer behavior was formed," with food delivery an "affordable luxury."
"Does the resumption of loan repayments introduce bookings risk to food delivery?" they asked. "We are afraid the answer is yes. To quantify the exposure, DoorDash and Uber Eats (NYSE:UBER, OP) have a greater proportion of MAUs in the 25- to 44-year-old cohort than any other company in our coverage universe at 65% and 67%, respectively, compared to the e-commerce industry average of 60%."
The age cohorts they referred to are said to carry 69% of the U.S. student loans.
"We consider food delivery, at a ~60% price premium to picking up an order in store, to be one of the most discretionary behaviors of an average consumer," the analysts added. "We appreciate the risk in being wrong but believe the near-term headwind makes the current risk-reward unattractive to us at this time."