BTIG upgrades Doximity saying pullback on macro fears overdone
Investing.com -- BTIG upgraded Doximity Inc (NYSE:DOCS) to Buy from Neutral and set a price target of $80, saying recent macro concerns are overstated and demand for the company's digital pharma sales tools remains strong.
Doximity shares have fallen from a recent high of $83 to around $52, pressured by fears of drug pricing reform, potential U.S.-China trade tensions, and broader macro uncertainty. But BTIG said the company's fundamentals remain intact and its guidance for fiscal 2026 is likely conservative. 'Our view is that many of the concerns driving the recent pullback are overdone,' analysts wrote. DOCS has beaten consensus revenue and EBITDA in 16 of the past 16 quarters, and tends to guide conservatively.
The firm pointed to Doximity's trailing 12-month net revenue retention rate of 119%, including 123% among its top 20 clients, as a sign of strong customer engagement. It also cited a 92% gross margin, EBITDA margin of 55%, and a debt-free balance sheet with $900 million in cash.
BTIG expects demand for targeted pharma sales technology to remain strong despite pressure on research-related services. The firm said recent results from peer Veeva showed the highest commercial revenue growth in three years, reinforcing the trend.
Doximity's self-service portal, which allows clients to directly manage campaign spending, was also highlighted as proof of high return on investment.
Valuation-wise, DOCS trades at 21.7x estimated 2027 EBITDA, slightly above the peer average. BTIG's $80 target implies 35x, which it said is justified by strong margins and high visibility in revenue.
'The company is well -positioned to benefit from the bio -pharma recovery, and we expect demand for digital advertising solutions to pick back up,' BTIG added.
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