Morgan Stanley believes Doximity stock looks attractive after the recent selloff. The bank has upgraded its digital platform for healthcare professionals from an equal-weighted rating to a over-weighted rating. The price forecast is $62 to $65, suggesting an upside of more than 48%. Analyst Craig Hettenbach wrote that Doximity’s 30% correction since its last earnings report on Nov. 6 provides an attractive entry point for investors. DOCS YTD Mountain DOCS YTD Chart “DOCS’ poor performance is inconsistent with business checks and increased platform engagement,” the analyst said. He noted that the stock is currently trading at a discount of more than 25% to the median post-COVID-19 EV/EBITDA multiple. Hettenbach wrote that the company has successfully expanded the platform’s reach “to multiple workflow streams throughout a clinician’s typical day,” adding that the company’s new product launches and acquisitions have fueled momentum. “Doximity has consistently expanded its suite of tools and deepened its integration into clinicians’ daily workflows, resulting in increased engagement and increased monetization,” he said. The analyst added that recent discussions with advertising agencies suggested that while growth in Doximity’s average daily users is slowing, time spent on the platform is increasing. He said the company remains the “clear leader” in pharmaceutical digital advertising targeted to medical professionals. “We believe AI-powered workflow tools will expand the market for marketing to healthcare professionals, and we believe concerns about competitive risks from OpenEvidence are overblown,” Hettenbach wrote. The analyst also cited Doximity’s strong free cash flow and strong balance sheet as further tailwinds. Doximity stock has fallen 18% since the beginning of the year.
