Prescription drug comparison tool GoodRx (NASDAQ:GDRX) is suffering brutal losses today. GDRX stock has lost nearly 40% of its value since Monday afternoon after failing to meet earnings expectations. Indeed, GoodRx has only continued to underperform the market, and today’s loss adds to an otherwise tumultuous 2022.
From its opening price of $33 per share in September 2020, GDRX has seen highs around $56, which is a far cry from its current $16.92 price point. Accordingly, investors are wondering if now is the time to buy the dip. Is it?
Well, GDRX is currently trending at its all-time low after a miserable Q4 earnings report. GoodRx failed to meet year-over-year net income expectations and didn’t instill confidence with its growth outlook. Citing “Covid-19 headwinds,” the drug discounter reigned in investors’ growth expectations for the next year. GoodRX also announced a $250 million stock-repurchase plan.
GoodRx’s latest earnings call has analysts abuzz with new price targets. Let’s see what the experts think about this company’s potential as its stock price tumbles.
3 Analysts Weigh In on GDRX Stock
Goldman Sachs analyst Eric Sheridan still believes GoodRx is a “buy” following its disappointing earnings call. Sheridan believes the company presents a high-growth opportunity with strong margins for the next five years. With that said, the banking giant lowered its price target to $30 from its previous $43.
Cowen analyst Charles Rhyee downgraded GDRX to “market perform” from its previous “outperform” rating. Rhyee set a price target of $22, citing long-term growth expectations tempered by near-term demand slowdowns.
JPMorgan analyst Doug Anmuth is even more bearish on GDRX. Indeed, Anmuth lowered its price target from $33 to $20, keeping its prior “underweight” rating. As Anmuth explained,
“We estimate the attainable market for core prescriptions transactions is ~$20B, accounting for the platform’s heavy skew toward generic drugs and take-rate model. … Looking ahead, the compounding effect of smaller cohorts and lower-than-expected healthcare utilization weighing on prescription fills is expected to result in a mid-20%’s Y/Y revenue growth profile for the next several years vs. our prior mid-30%’s estimate at the time of the IPO.”
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
