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GRUB

GrubHub

$70.07

5.4 (8.35%)

, AMZN

Amazon.com

$1,864.24

2.98 (0.16%)

05:13
06/12/19
06/12
05:13
06/12/19
05:13

GrubHub likely an attractive takeover target for Amazon, says Mizuho

Mizuho analyst Jeremy Scott says the Wall Street Journal's report that Amazon.com (AMZN) is dropping its restaurant delivery platform in the U.S. underscores his view that the market will eventually consolidate to two-to-three players. The shuttering of the platform doesn't necessarily mean that Amazon won't eventually invest in the space, but it at least temporarily removes the "existential threat of an aggressive organic expansion" and, in turn, positions the company as a potential acquirer, Scott told investors yesterday in a research note. He believes Amazon's recent investment in U.K. delivery company Deliveroo signals the company continues to actively participate in the space. Grubhub (GRUB) is likely an attractive takeover target, says Scott. However, the analyst continues to believe there are more effective combinations for Grubhub that can better enable the company to "carve an inside track of restaurant-centric, enterprise solutions." He keeps a Buy rating on Grubhub shares with a $100 price target. The stock closed yesterday up 8%, or $5.33, to $70.06.

GRUB

GrubHub

$70.07

5.4 (8.35%)

AMZN

Amazon.com

$1,864.24

2.98 (0.16%)

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GRUB GrubHub
$70.07

5.4 (8.35%)

05/02/19
05/02/19
DOWNGRADE

Hold
GrubHub downgraded to Hold at Argus on rising costs and margin pressure
As previously reported, Argus analyst John Staszak downgraded GrubHub to Hold, also lowering his FY19 and FY20 EPS outlook by 10c to $1.70 and $2.40 respectively. The analyst believes that the company will see higher costs and margin pressure as it enters new markets and also warns that differentiation challenges relative to the emerging competition could slow its growth rate over the coming several years. Staszak lowers his 5-year earnings growth outlook to 20% from 25% prior.
05/02/19
05/02/19
DOWNGRADE

Fly Intel: Top five analyst downgrades
Catch up on today's top five analyst downgrades with this list compiled by The Fly: 1. Hilton (HLT) downgraded to Hold from Buy at Deutsche Bank with analyst Carlo Santarelli saying he's making a stock call on valuation, not a company call. He expects the stock to take a "breather" following the post-earnings rally. 2. Estee Lauder (EL) was downgraded to Sector Perform from Outperform at RBC Capital and to Neutral from Buy at DA Davidson. 3. Scotts Miracle-Gro (SMG) downgraded to Underperform from Neutral at BofA/Merrill with analyst Christopher Carey saying Scotts reported "solid" Q1 results, but he is concerned about difficult comps ahead and market expectations for a guidance raise. 4. GrubHub (GRUB) downgraded to Hold from Buy at Argus with analyst John Staszak saying he believes that the company will see higher costs and margin pressure as it enters new markets and also warns that differentiation challenges relative to the emerging competition could slow its growth rate over the coming several years. 5. Cree (CREE) downgraded to Perform from Outperform at Oppenheimer wth analyst Colin Rusch saying management has executed well on its turnaround plan, but this is currently reflected in the shares. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.
05/20/19
GDHS
05/20/19
INITIATION
Target $75
GDHS
Buy
GrubHub initiated with a Buy at Gordon Haskett
Gordon Haskett analyst Robert Mollins started GrubHub with a Buy rating and $75 price target, telling investors that he sees the "short-term pain" from its investments in marketing and delivery market expansion leading to long-term gains. He believes that the stock's multiple will recover as investors recognize that Grubhub's recent market share losses have largely been "low or no margin customers" who have been taking advantage of competitors' free delivery offers. He also notes that GrubHub has a 95% repeat customer base, which means most of its future marketing can be geared towards new customer acquisition and accelerating awareness in new delivery markets.
05/31/19
BNCH
05/31/19
NO CHANGE
BNCH
Buy
Waitr has kept market share, at worst, in competitive markets, says Benchmark
Benchmark analyst Daniel Kurnos said he left recent meetings with Waitr (WTRH) management with the belief that the strong underlying fundamentals that were "overlooked and on display" in Q1 should continue through the year. He added that private credit card data and publicly available market data show Waitr "has, at worst, maintained their market share in even their most competitive markets" while GrubHub (GRUB) has faced the biggest challenge from competition. Kurnos maintains a Buy rating on Waitr Holdings shares.
AMZN Amazon.com
$1,864.24

2.98 (0.16%)

06/06/19
DADA
06/06/19
NO CHANGE
Target $9
DADA
Buy
Cloudera price target lowered to $9 from $23 at DA Davidson
DA Davidson analyst Rishi Jaluria lowered his price target on Cloudera (CLDR) to $9 after its "disastrous" quarter with a reset of the company's recurring revenue expectations, resignation of its CEO, and weak bookings, as customers await the release of Cloudera Data Platform, or CDP. The analyst also points to Cloudera's higher churn, and increased competitiveness from Amazon's (AMZN) AWS, Microsoft's (MSFT) Azure, and Google's (GOOGL) GCP impacting the quarter. Jaluria cuts his FY21 EPS view to (19c) from 22c but maintains his Buy rating on Cloudera, citing his "glimmer of hope" that the company can reaccelerate growth with CDP or that either a private equity firm or IBM (IBM) would acquire it given the reduced 1.8-times enterprise value to expected 2020 revenue valuation.
06/07/19
SBSH
06/07/19
NO CHANGE
SBSH
FedEx decision could mark 'beginning of the end' with Amazon, says Citi
Citi analyst Christian Wetherbee said FedEx's (FDX) strategic decision to not renew its domestic Express contract with Amazon (AMZN) will likely have an immaterial financial impact, given that the companies still will do other business and he assumes Amazon is a below-average margin customer. However, the "fairly bold pronouncement" from FedEx "could mark the beginning of the end" with Amazon, which he believes FedEx views as a long-term threat, Wetherbee tells investors. He sees the news as a positive strategic decision for FedEx, and does not expect a materially negative reaction in the shares, though it could add "further messiness" to guidance, the analyst added. In late day trading, FedEx shares are up 1% to $158.39.
06/10/19
BERN
06/10/19
NO CHANGE
BERN
Not the first time FedEx declines to provide service to Amazon, says Bernstein
Bernstein analyst David Vernon notes that FedEx (FDX) announced that it would not be renewing its U.S. Express contract with Amazon (AMZN). The analyst believes the majority of FedEx's revenue with Amazon was tied up in the deferred air network within Express, and the loss of this business could create a $700-750M hole in the day network. On the other hand, FedEx stock is sensitive to Amazon headlines, and removing the volume partially mitigates this risk as it removes the speculation about how much of FedEx's revenue is or is not from Amazon, he contends. Vernon also thinks the failure to reach commercial terms on this contract is as much about what FedEx will accept economically as it is about what Amazon wants to do with its supply chain. This is not the first time that FedEx has declined to provide service to Amazon, as it previously walked away from what Amazon was asking the company to do with the SmartPost in Ground, he adds.
06/11/19
FBCO
06/11/19
NO CHANGE
Target $184
FBCO
Outperform
FedEx price target lowered to $184 from $241 at Credit Suisse
Credit Suisse analyst Allison Landry lowered his price target for FedEx (FDX) to $184 from $241 in light of the deceleration in the U.S. and global macro and temporary volume and cost headwinds, including 7-day Ground and non-renewal of the Amazon (AMZN) Domestic Express contract. The analyst reiterates an Outperform rating on FedEx shares.

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