Shares keep falling, hitting a new post-IPO low Monday.
Instacart stock continues to struggle following its recent initial public offering, thanks at least in part to skepticism from Wall Street analysts about the near-term prospects for the company.
Instacart , officially known as Maplebear, priced its initial public offering last month at $30 a share and opened for trading at $42. But the grocery delivering service’s shares have been sinking since. On Monday, the stock extended its recent decline, sinking more than 7% and setting a new post-IPO intraday low at $27.51.
Adding to the pressure, Gordon Haskett analyst Robert Mollins picked up coverage of Instacart on Monday with a Hold rating and $31 target price. That follows similarly cautious calls from Needham analyst Bernie McTiernan and BTIG analyst Jake Fuller, who both set Neutral ratings on the stock. Gordon Haskett’s Mollins writes in a research note that he has doubts that grocery delivery adoption will continue to materially increase as consumers become more cautious about spending. “Our survey data indicates that consumer demand for online grocery delivery has materially tapered in recent months” relative to levels seen during the pandemic period.
Like McTiernan and Fuller, Mollins is also worried about competition, which he says has already led to loss of market share in the online grocery delivery segment for Instacart this year. Mollins also sees risks that Instacart customers could shift to alternative programs from Amazon.com and Walmart that offer more services and better value.
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