Why is Instacart stock trending down on Monday?

October 02, 2023 10:05 AM PDT | By Invezz
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Instacart (NASDAQ: CART) is down nearly 9.0% at writing after “The Information” said the next couple of quarters were likely to be challenging for the delivery company.

Instacart will see slower revenue growth

Anonymous sources told the tech-focused business publication today that analysts at Goldman Sachs expect Instacart to grow its revenue by 8.0% only (at the top end of their range) in the second half of this year.

In comparison, the California-based company had seen its revenue pop a whopping 50% in the back half of last year and 31% in the first six months of 2023.

Note that Goldman Sachs was among the Wall Street banks that underwrote the initial public offering (IPO) of Instacart this month.

At writing, Instacart stock is down close to 20% versus its year-to-date high.

Gordon Haskett rates Instacart stock at ‘hold’

Goldman Sachs experts are convinced that slower revenue growth will translate to lower profits for Instacart in the coming quarters, as per The Information.

Also today, Robert Mollins – a Gordon Haskett analyst assumed coverage of the Nasdaq-listed firm with a “hold” rating that’s also contributing to the downward pressure on its shares at writing.  

He recommends caution on Instacart stock as online grocery delivery could take a hit as consumer spending slows down in the coming months.

Other reasons cited for the “meh” view on the San Francisco-headquartered firm include “competitive encroachment” that could result in a decline in the number of subscribers on Instacart+. Last month, a Needham analyst had initiated Instacart stock with a “hold” rating as well (find out more).

The post Why is Instacart stock trending down on Monday? appeared first on Invezz.


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