10 Best Food Stocks To Buy According to Hedge Funds

2. DoorDash, Inc. (NASDAQ:DASH)

Number of Hedge Fund Holders: 73

DoorDash, Inc. (NASDAQ:DASH) is a technology company that connects customers with local businesses. The platform allows users to order food, groceries, and other items from a variety of merchants. DoorDash, Inc. (NASDAQ:DASH) also offers delivery and pickup services as well as subscription-based memberships for added benefits.

The stock recently reached a 52-week high at $154.18. This milestone reflects an 84% increase over the past year. Investors are clearly confident in DoorDash, Inc.’s (NASDAQ:DASH) business model and growth strategy, propelling the stock despite competition in the gig economy and food delivery sector. DoorDash, Inc. (NASDAQ:DASH) also expanded its grocery delivery partnership with Wegmans, further solidifying its presence in this rapidly growing segment.

In the future, the company aims to broaden its offerings beyond food delivery to include items like alcohol, beauty products, and sports goods, significantly expanding its total addressable market. Despite being in the early stages of this expansion, DoorDash, Inc. (NASDAQ:DASH) has already achieved a 22.3% year-over-year revenue growth, highlighting strong demand for its services.

In Q3, the company’s user growth was strong, with double-digit increases and an all-time high achieved during the quarter. Order frequency also reached record levels, driven by improvements in selection, quality, and affordability.

Here’s what TimesSquare Capital Management said about DoorDash, Inc. (NASDAQ:DASH) in its Q2 2024 investor letter:

“Our preferences in the Consumer-oriented sectors lean toward value-oriented or specialty retailers, franchise models, or premium brands. New to the strategy was the online food delivery platform and logistics provider DoorDash, Inc. (NASDAQ:DASH) Since its IPO in 2021, the company’s scale has grown to entrench it with customers and consumers, though we have been cautious about its high valuation. Recently, the company reported lower-than-expected guidance for future margins and that caused its shares to sell off. In our view, DoorDash was appropriately investing for future growth and absorbing recent increased wage costs. Believing this short-term price dislocation made for an attractive entry price, we began buying, and DoorDash was up 2% through the end of the quarter.”