Value
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 8.4 |
| P/S | 8.9 |
| EV/EBITDA | 5.8 |
| Fwd P/E | 9.6 |
| PEG | 8.9 |
| Analyst target | 7.5 |
- ▸Forward P/E: 7.5x
- ▸PEG: 0.68
- ▸Attractively valued
GDDY · Why this verdict
Why GoDaddy (GDDY) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
GoDaddy is a high-quality franchise — strong operating margins of 17%, free cash flow at 155% of net income, and consistent earnings delivery — trading at a forward earnings multiple of 7.2 times and a price-to-growth ratio of 0.68, a discount that looks unwarranted on fundamentals. The near-term obstacle is a confirmed technical breakdown: death cross, price below all moving averages with the average declining at roughly 8.5% per 30 days, and RSI near 33 mean near-term pressure may linger before any revaluation begins.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The stock screens attractively valued at a forward earnings multiple of 7.2 times and a price-to-growth ratio of 0.68, while the business earns strong operating margins of 17%, a Piotroski financial health score of 7 out of 9, and analyst consensus implies roughly 47% upside — a combination that suggests the market is pricing the stock well below its fundamental quality. Valuation breakdown | The forward multiple expands above 12 times within 12 months as revenue growth accelerates from its current low-single-digit pace, closing the gap between price and underlying quality. | →Stable |
| CounterA debt-to-equity ratio of 16.2 and persistently soft top-line growth may be precisely why the multiple stays compressed — the discount could reflect a structurally limited growth ceiling rather than an opportunity. | ||
Core Platform products account for 62% of revenue, creating meaningful sensitivity to any disruption, pricing shift, or competitive pressure in a single product cluster that limits the business's ability to absorb segment-level stress. Bear case | Non-Core-Platform revenue grows faster than the Core segment over the next 12 months, reducing concentration below 55% of total revenue. | →Stable |
| CounterDominant share in a flagship product can reflect customer lock-in and switching costs rather than fragility — if Core Platform enjoys strong retention, the concentration may remain stable without translating into elevated realized risk. | ||
Free cash flow is running at 155% of reported net income, meaning the business generates meaningfully more in cash than accounting earnings reflect — a durable quality signal that the earnings base understates real cash-generating power. Quality breakdown | Free cash flow conversion stays above 120% of net income over the next four quarters, enabling debt reduction given the elevated leverage position. | →Stable |
| CounterRevenue concentration in Core Platform products at 62% leaves cash generation dependent on a single segment — any disruption there could rapidly compress the conversion rate the bull case relies on. | ||
The stock is in a confirmed downtrend — below its 200-day moving average with that average declining at roughly 8.5% over 30 days, a death cross in force, and RSI near 33 — indicating sellers remain in control and that near-term price pressure may persist. Momentum breakdown | Price reclaims the 200-day moving average and RSI rises above 50 within 6 months, confirming a trend reversal from the current breakdown. | →Stable |
| CounterOn-balance volume is rising despite falling price, suggesting buyers may be accumulating at current levels — a divergence that can precede a price recovery even before the trend technically confirms. | ||
Three of the last four quarters produced positive earnings surprises — a beat of roughly 2.7% in the most recent quarter, a prior beat of 3.7%, then one miss of -7.1%, and an earlier beat of 5.4% — demonstrating broadly consistent delivery against estimates over the recent period. Earnings | The next quarterly report (expected in approximately 51 days) produces a positive earnings surprise, sustaining three or more beats in any rolling four-quarter window. | →Stable |
| CounterThe average quarterly surprise of roughly 1.2% is thin, and the one material miss of -7.1% was significant — the beat pattern may reflect conservatively set guidance rather than genuine outperformance, which can reverse quickly if guidance is raised. | ||
The stock screens attractively valued at a forward earnings multiple of 7.2 times and a price-to-growth ratio of 0.68, while the business earns strong operating margins of 17%, a Piotroski financial health score of 7 out of 9, and analyst consensus implies roughly 47% upside — a combination that suggests the market is pricing the stock well below its fundamental quality.
→StableValuation breakdown
- Expectation
- The forward multiple expands above 12 times within 12 months as revenue growth accelerates from its current low-single-digit pace, closing the gap between price and underlying quality.
CounterA debt-to-equity ratio of 16.2 and persistently soft top-line growth may be precisely why the multiple stays compressed — the discount could reflect a structurally limited growth ceiling rather than an opportunity.
Core Platform products account for 62% of revenue, creating meaningful sensitivity to any disruption, pricing shift, or competitive pressure in a single product cluster that limits the business's ability to absorb segment-level stress.
→StableBear case
- Expectation
- Non-Core-Platform revenue grows faster than the Core segment over the next 12 months, reducing concentration below 55% of total revenue.
CounterDominant share in a flagship product can reflect customer lock-in and switching costs rather than fragility — if Core Platform enjoys strong retention, the concentration may remain stable without translating into elevated realized risk.
Free cash flow is running at 155% of reported net income, meaning the business generates meaningfully more in cash than accounting earnings reflect — a durable quality signal that the earnings base understates real cash-generating power.
→StableQuality breakdown
- Expectation
- Free cash flow conversion stays above 120% of net income over the next four quarters, enabling debt reduction given the elevated leverage position.
CounterRevenue concentration in Core Platform products at 62% leaves cash generation dependent on a single segment — any disruption there could rapidly compress the conversion rate the bull case relies on.
The stock is in a confirmed downtrend — below its 200-day moving average with that average declining at roughly 8.5% over 30 days, a death cross in force, and RSI near 33 — indicating sellers remain in control and that near-term price pressure may persist.
→StableMomentum breakdown
- Expectation
- Price reclaims the 200-day moving average and RSI rises above 50 within 6 months, confirming a trend reversal from the current breakdown.
CounterOn-balance volume is rising despite falling price, suggesting buyers may be accumulating at current levels — a divergence that can precede a price recovery even before the trend technically confirms.
Three of the last four quarters produced positive earnings surprises — a beat of roughly 2.7% in the most recent quarter, a prior beat of 3.7%, then one miss of -7.1%, and an earlier beat of 5.4% — demonstrating broadly consistent delivery against estimates over the recent period.
→StableEarnings
- Expectation
- The next quarterly report (expected in approximately 51 days) produces a positive earnings surprise, sustaining three or more beats in any rolling four-quarter window.
CounterThe average quarterly surprise of roughly 1.2% is thin, and the one material miss of -7.1% was significant — the beat pattern may reflect conservatively set guidance rather than genuine outperformance, which can reverse quickly if guidance is raised.
Per-dimension breakdown
Quality
7.9/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 6.3 |
| Gross margin | 8.8 |
| Op margin | 9.9 |
| Net margin | 8.7 |
| Current ratio | 2.7 |
| FCF quality | 10.0 |
| Moat | 6.9 |
| Piotroski F | 7.8 |
- ▸Excellent ROE: 398%
- ▸Strong margins: 17%
- ▸Excellent cash conversion: 155% FCF/NI
- ▸Strong Piotroski F-Score: 7/9
Growth
3.6/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.0 |
| EPS growth | 3.2 |
Momentum
5.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 9.3 |
| OBV | 10.0 |
| MA position | 4.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -8.4%/30d — confirmed downtrend
Sentiment
6.7/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 4.0 |
| Analyst rating | 7.2 |
| Price target | 9.1 |
- ▸Analyst upside: 38%
Insider
3.9/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 5.1 |
- ▸Modest insider selling — $2,217,114 (0.021% of mkt cap)
Peer rank
4.5/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 7.9 |
| quality rank | 8.6 |
| growth rank | 1.6 |
- ▸Superior ROE vs peers
Technical
4.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.0 |
| support resistance | 5.7 |
| 52w position | 0.0 |
| gap | 6.0 |
Risk (lower is worse)
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.3 |
| days to cover | 8.3 |
| volatility | 0.0 |
| put call | 6.4 |
| implied vol | 4.0 |
| max pain risk | 7.0 |
| beta | 7.7 |
| debt equity | 0.0 |
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 3.1 |
| news activity | 5.0 |
- ▸Strong earnings: 3B/1M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (7)
- MOMENTUM:5.6>=5.5
- ASYMMETRY:1.7>=1.5
- INSIDER:OK
- DEATH_CROSS:QUALITY_MOMENTUM_EXEMPT
- EARNINGS_PROXIMITY:42d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (0)
none
Warning (2)
- DEATH_CROSS:quality=7.9>=7.5+momentum=5.6>=5.0 exempted
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
1.70
Upside
+20.1%
Downside
11.8%
Sizing output
AVOID
SetupRECOVERY — Death cross but MACD improving, RSI 43
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.2 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 8.3) was not enough to lift the adjusted overall above the threshold. Current asymmetry R:R is 1.70 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 8.3, Quality at 7.9, and Sentiment at 6.7; the weakest are Growth at 3.6, Insider at 3.9, and Technical at 4.2. The V9 engine cleared all gates with 2 warnings, producing an asymmetric reward-to-risk of 1.70 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1The stock screens attractively valued at a forward earnings multiple of 7.2 times and a price-to-growth ratio of 0.68, while the business earns strong operating margins of 17%, a Piotroski financial health score of 7 out of 9, and analyst consensus implies roughly 47% upside — a combination that suggests the market is pricing the stock well below its fundamental quality.
Trip ifOperating margin falls below 10% for 2 consecutive quarters.
- P2Free cash flow is running at 155% of reported net income, meaning the business generates meaningfully more in cash than accounting earnings reflect — a durable quality signal that the earnings base understates real cash-generating power.
Trip ifFree cash flow falls below $0 for 2 consecutive quarters.
- P3The stock is in a confirmed downtrend — below its 200-day moving average with that average declining at roughly 8.5% over 30 days, a death cross in force, and RSI near 33 — indicating sellers remain in control and that near-term price pressure may persist.
Trip ifPrice reclaims the 200-day moving average and RSI stays above 50 for 20 or more consecutive trading days.
- P4Three of the last four quarters produced positive earnings surprises — a beat of roughly 2.7% in the most recent quarter, a prior beat of 3.7%, then one miss of -7.1%, and an earlier beat of 5.4% — demonstrating broadly consistent delivery against estimates over the recent period.
Trip ifEPS surprise falls below 0% for 2 consecutive quarters.
- P5Core Platform products account for 62% of revenue, creating meaningful sensitivity to any disruption, pricing shift, or competitive pressure in a single product cluster that limits the business's ability to absorb segment-level stress.
Trip ifCore Platform revenue contribution falls below 50% of total revenue for 2 consecutive quarters.