GoDaddy Stock Rises After FTC Settlement, Promise To Bolster Security: Retail Sentiment Mixed
The FTC alleged in its complaint that GoDaddy did not implement reasonable security measures against threats and misled customers about the data security measures it had enabled on its platform.
Shares of GoDaddy Inc. (GDDY) surged more than 1% in mid-market trade on Wednesday after the web hosting company entered into a settlement with the U.S. Federal Trade Commission (FTC).
The FTC had alleged in its complaint that GoDaddy did not implement reasonable security measures against threats and misled customers about the data security measures it had enabled on its platform.
GoDaddy offers domain registration and web hosting services. At the end of 2023, it had 62 million registered domains, making it the fifth-largest host by market share.
The FTC underscored this in its announcement and noted that it had secured promises from GoDaddy to bolster its security measures to protect its customers.
“Millions of companies, particularly small businesses, rely on web hosting providers like GoDaddy to secure the websites that they and their customers rely on,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection.
The federal agency observed that GoDaddy suffered multiple data breaches between 2019 and 2022, wherein attackers gained access to customers’ websites and data.
As part of the order on Wednesday, GoDaddy has been prohibited from misleading its customers, enhancing its security program, and hiring an independent third-party security assessor.
“The FTC is acting today to ensure that companies like GoDaddy bolster their security systems to protect consumers around the globe,” Levine added.
Analysts at Morgan Stanley upgraded the GoDaddy stock price target earlier today from $189 to $226, citing accelerating product innovation. This implies an upside of nearly 13%.
Meanwhile, retail sentiment on Stocktwits was in the ‘neutral’ (45/100) at the time of writing.
GDDY sentiment and message volume January 15, 2025, as of 2 pm ET | Source: StocktwitsOne user thinks the GoDaddy stock “appears to be undervalued.”
GoDaddy’s share price has surged nearly 36% in the past six months. Its one-year performance is stellar, too, with gains of more than 90%.
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