GoDaddy (GDDY) Bullish Stance Reiterated at RBC Capital Amid 'Strong' Q1

RBC Capital analyst Mark Mahaney reiterated an Outperform rating and $30 price target on GoDaddy Inc (NYSE: GDDY) following strong Q1 results.

The keys to the quarter, according to Mahaney:

(1) Bookings Growth And Diversification – Bookings grew nearly 14% Y/Y, with Domains Revenue grew 10% Y/Y, Hosting & Presence grew 21% Y/Y, and Business Applications grew 53% Y/Y;

(2) Reasonably Strong Profitability – Q1 Gross Margins of 63.5% and EBITDA Margins of 24.9% beat our estimates of 62.8%/23.6%, with leverage in COGS from Revenue diversification and Technology expense leverage;

(3) Pro Forma Financial Leverage – Approximately 3x Net Debt / LTM EBITDA is a healthy level, in our view;

(4) International Expansion – Int’l Revenue is about ¼ of Total Rev, and mgmt expects to be in local Asian markets later in 2015; and

(5) Continued Leadership – With 21% of total global domains under management and over 300 gTLDs to offer customers.

The firm's ’15 Revenue remains largely unchanged at $1.60B, but EBITDA tweaks up 2% to $325MM on better than expected leverage.

For an analyst ratings summary and ratings history on GoDaddy Inc click here. For more ratings news on GoDaddy Inc click here.

Shares of GoDaddy Inc closed at $26.77 yesterday.

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