GoDaddy Earnings: Positive Trends Persist on Bookings Growth and Profitability Improvements

We are raising our fair value estimate for no-moat GoDaddy to $135 per share from $120 after the company reported good results for the third quarter and provided solid guidance. GoDaddy continues to enjoy a mix shift to higher-margin solutions, including bundling and artificial intelligence-embedded technologies, while achieving operational efficiencies, including leveraging AI in customer support. We nudged our near-term estimates higher, notably around profitability, which helped drive our fair value higher. Strong bookings growth continues to outpace revenue, giving us confidence in our top-line forecast over the next couple of years. While we are impressed with management’s execution, we see shares as expensive and prefer to invest in moatier names under our coverage.