Doximity Downgraded to Underperform with $20 Price Target and Margin Cuts
DOCS•BofA Securities downgraded Doximity from Buy to Underperform, cutting its price target to $20 from $38 and triggering a 5% premarket share drop. Trimmed fiscal 2027 and 2028 revenue estimates and cut 2028 EBITDA margin to 46.5% and 2029 margin to 46.0% on rising AI investment and execution risks.
1. Analyst Downgrade and Price Target
BofA Securities revised Doximity’s rating to Underperform and cut the price target to $20 from $38, leading to a 5% decline in premarket trading.
2. Revenue and Margin Forecast Cuts
The brokerage trimmed fiscal 2027 and 2028 revenue projections and reduced the 2028 EBITDA margin forecast to 46.5% and the 2029 margin forecast to 46.0%, down from over 51% previously.
3. Competitive and Execution Risks
The analyst cited limited visibility into Doximity’s AI-driven growth strategy, rising investment spending, reliance on third-party AI models, and increased competition from OpenAI and OpenEvidence as key risks to margins and market share.
