| 2019-06-12 05:13:54|
GRUB, AMZN 05:13 06/12 06/12/19
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.