Barclays double upgrades GrubHub, says stock worth well over $50 in buyout

Barclays analyst Deepak Mathivanan upgraded GrubHub to Overweight from Underweight with a price target of $51, up from $27. The stock closed Thursday up $1.87 to $38.50. Shares of GrubHub declined by 75% in 15 months given an "irrational" competitive landscape, "ill-timed" strategic investments, and poor execution, Mathivanan tells investors in a research note titled "Dear Board - It's Time to Fold 'Em." The analyst thinks the time is now for the board to prevent further erosion. He recommends the board reduce investments on unproven areas, preserve asset value "before it's too late," and explore consolidation to realize synergies. For example, if Uber Eats (UBER) were to acquire GrubHub, it could achieve "significant" revenue and cost synergies, says Mathivanan. In a potential acquisition, the analyst believes GrubHub's could fetch "well north" of $50 per share.