Street Calls of the Week
Investing.com - Bernstein SocGen Group maintained its Outperform rating and $63.00 price target on Instacart (NASDAQ:CART) despite recent competitive pressures from Amazon. According to InvestingPro data, the company maintains a "GREAT" financial health score, with strong liquidity and minimal debt exposure.
Instacart stock fell 9% on Friday following news that Amazon (NASDAQ:AMZN) is partnering with regional grocery chain Winn-Dixie in Florida for grocery delivery services. The partnership will initially focus on Orlando and Jacksonville markets.
The Amazon-Winn-Dixie announcement follows Amazon’s recent expansion into same-day delivery for perishable items and comes amid rising minimum pay requirements for Instacart workers in New York City.
Bernstein noted that Winn-Dixie’s presence across five Southeastern states raises questions about how quickly Amazon could expand this partnership model to additional markets and grocers, creating competitive pressure for Instacart.
The research firm suggested Instacart needs to "leverage this news to encourage grocers to adopt greater price parity" and emphasized that continued 10% growth would support the stock, which currently trades at 8.5 times EBITDA.
In other recent news, Instacart has been the subject of several analyst reviews and strategic developments. Morgan Stanley reiterated its Equalweight rating on Instacart, adjusting its price target to $48.00, citing consistent execution despite competitive pressures. The grocery delivery platform has outperformed expectations, exceeding its gross transaction value guidance in five out of seven quarters since its IPO and surpassing adjusted EBITDA guidance in all seven quarters. Meanwhile, Bernstein SocGen Group maintained its Outperform rating with a $63.00 price target, even as New York City approved minimum pay thresholds for delivery workers, which could introduce new cost pressures. Cantor Fitzgerald also reiterated its Overweight rating and $63.00 price target, noting potential risks from Amazon’s grocery expansion but emphasizing Instacart’s strong supplier relationships. Additionally, Citizens JMP kept its Market Outperform rating with a $60.00 price target, pointing to key growth categories as potential benefits for the company. In a strategic move, Instacart appointed Josh Silverman, CEO of Etsy, to its Board of Directors, bringing significant marketplace and technology expertise to the company. These developments reflect the dynamic environment in which Instacart operates as it navigates regulatory changes and competitive challenges.
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