Instacart Stock Forecast 2023: Is Instacart a Good Investment?

Instacart Stock Forecast 2023: Latest Stock Price

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Instacart is a grocery delivery and pickup service in the United States and Canada. Founded in 2012 by Apoorva Mehta, Max Mullen, and Brandon Leonardo, Instacart has become one of the most popular grocery delivery services in the world. The company’s business model is simple: customers order groceries from their local grocery stores through the Instacart website or app, and Instacart personal shoppers pick up the groceries and deliver them to the customer’s door.

Instacart Stock Forecast 2023: Latest News

Instacart has welcomed Ravi Gupta, a Partner at Sequoia Capital, to its Board of Directors.

Instacart Stock Price Falls Back to its IPO Price

Instacart went public on Tuesday at $30 per share but the stock price opened at $42 however, the stock price started to fall and the stock closed below $40 but well above its listing price. Instacart’s stock price has failed to recover in the last 3 trading days. The stock closed around 2.12% lower in the past 24 hours which took the stock price to its IPO price.

Analysts’ Opinions

Analyst Bernie McTernan from Needham has initiated coverage of the company with a “Hold” rating. This decision stems from worries about the company’s growth slowing down and facing tough competition from Amazon, Walmart, Uber Technologies, DoorDash, and other rivals.
BTIG analyst Jake Fuller has given Instacart a “Neutral” rating due to concerns about its modest growth prospects and intense competition. Fuller predicts slow growth in the online grocery market, estimating a market share increase of less than one percentage point annually, reaching around 15% by 2026. While Instacart boasts healthy profit margins and a strong market position, these positives are overshadowed by its slow growth, competitive landscape, and valuation, leading to the “Neutral” rating.

Instacart’s Co-Founder Apoorva Mehta Resigns

Instacart’s cofounder, Apoorva Mehta now has a net worth of $1.3 billion after the company’s IPO on September 19, 2023. He also cut all ties with the company on the same day, resigning as executive chairman. Mehta has said that he is stepping down from Instacart to focus on his new company, Cloud Health Systems, which is a health-tech startup that aims to address chronic illness.

Investors Who Got Rich after Instacart IPO

Apoorva Mehta: Instacart’s co-founder and former executive chairman owned a 10% stake in the company, which is now worth $1.3 billion.

Nick Giovanni: Instacart’s CFO owned 1.5 million shares of the company, which are now worth $29 million.

Sequoia Capital: Instacart’s largest investor, Sequoia Capital, owned a 15% stake in the company, which is now worth $1.5 billion.

D1 Capital Partners: Instacart’s second-largest investor, D1 Capital Partners, owned a 10% stake in the company, which is now worth $1 billion.

Other investors: Other investors in Instacart who got rich in the IPO include Tiger Global Management, Coatue Management, and Andreessen Horowitz.

Instacart Quarterly Financial Results

Fourth Quarter, 2023

Some of the key findings from Instacart’s fourth quarter results for 2023:

Revenue: Instacart’s revenue grew 39% year-over-year to $2.5 billion in the fourth quarter of 2023. This was below the company’s guidance of 40% growth.
Gross profit: Instacart’s gross profit margin was 44% in the fourth quarter of 2023, down from 45% in the third quarter.
Net income: Instacart’s net income was $10 million in the fourth quarter of 2023, down from $71 million in the third quarter.
Active customers: Instacart’s active customer base was 13.7 million in the fourth quarter of 2023, up 27% year-over-year.
Active shoppers: Instacart’s active shopper base was 500,000 in the fourth quarter of 2023, up 25% year-over-year.

The company’s CEO, Fidji Simo, said in a statement that Instacart is “facing some headwinds” in the current quarter, but that the company is “confident in our long-term growth prospects.”

Despite these challenges, Instacart remains a leading player in the grocery delivery market. The company is well-positioned to continue to grow in the years to come, as the demand for online grocery shopping continues to grow.

Instacart IPO Related Information

Why Did Instacart Cut its Valuation? In its IPO filing with the US SEC, Instacart mentioned that it had 279 million shares outstanding as of Aug. 15. Including the stock options and the restricted stock units of 20.45 million and 31.47 million, respectively, the total stock for the purpose of valuing the company comes to 331 million shares. With the stock price expected to be between $26 and $28 per share, the valuation of the company is expected to be between $8.6 billion to $9.3 billion.

Back in March 2022, the company’s internal valuation was $24 billion, and in July it was reduced to $15 billion now the valuation after the IPO listing is expected to be less than $10 billion. The reason behind this could be that the company might be looking to test the investors’ interest in the new listings. Added to it, the higher interest rates and uncertain economic conditions have not turned out to be fruitful for new listings around the world.

Read the Instacart IPO filing document here.

Instacart IPO Goes Live

Instacart has been planning to go public in September 2023. The company had initially set a price range of $26 to $28 per share, valuing it at up to $9.3 billion. The IPO is expected to be one of the largest of the year. However, after the success of the ARM IPO, the company valued its stock at $30 for listing. On Tuesday, September 20th, Instacart went live.

Instacart is a grocery delivery company that was founded in 2012. The company allows users to order groceries from their local stores and have them delivered to their homes. Instacart has over 500,000 shoppers and partners with over 750 retailers across the United States.

The company’s IPO comes at a time when the online grocery market is growing rapidly. The market is expected to grow at a compound annual growth rate (CAGR) of 16.5% from 2022 to 2027. This growth is being driven by a number of factors, including the increasing convenience of online grocery shopping, the growing number of dual-income households, and the aging population.

Instacart is the leading grocery delivery service in the United States, with a market share of over 50%. The company is well-positioned to benefit from the growth of the online grocery market. However, there are also some risks to consider before investing in Instacart stock.

Overall, Instacart is a growth stock with a number of attractive features

Will Insatcart reach $100 in 2023?

It is impossible to say for sure whether Instacart will reach $100 per share in 2023. The company’s stock price is influenced by a variety of factors, including its financial performance, market trends, and investor sentiment.

Instacart went public in September 2023 at a price of $30 per share. However, the stock price has since fallen to around $25 per share. This is likely due to a number of factors, including the overall decline in the stock market and concerns about Instacart’s profitability.

Despite the recent decline in its stock price, Instacart is still a growing company. The company’s revenue is expected to increase by around 20% in 2023. Instacart is also expanding its business into new areas, such as alcohol delivery and prescription drug delivery.

If Instacart can continue to grow its revenue and become more profitable, its stock price could reach $100 per share in 2023. However, it is important to note that this is just a prediction. There is no guarantee that Instacart’s stock price will reach $100 per share in 2023 or any other time.

Is Instacart a good investment option?

Whether or not Instacart is a good investment option depends on your individual investment goals and risk tolerance. Here are some factors to consider:

There are a few reasons why Instacart could be a good investment. First, the company is growing rapidly. In 2022, Instacart processed 263 million orders totaling $29.4 billion in gross transaction value (GTV). This marks an annual increase of 80% between 2018 and 2022.

Second, Instacart has a strong competitive position. The company is the leading grocery delivery service in the United States, with a market share of over 50%. Instacart also has a strong network of shoppers and stores, which gives it a competitive advantage over other grocery delivery services.

Third, Instacart is well-positioned to benefit from the growth of the online grocery market. The online grocery market is expected to grow at a compound annual growth rate (CAGR) of 16.5% from 2022 to 2027. This growth is being driven by a number of factors, including the increasing convenience of online grocery shopping, the growing number of dual-income households, and the aging population.

However, there are also some risks to consider before investing in Instacart stock. First, the company is still unprofitable. Instacart has never turned a profit, and it is not clear when the company will become profitable.

Second, the grocery delivery market is competitive. Instacart faces competition from a number of other grocery delivery services, including DoorDash, Uber Eats, and AmazonFresh.

Third, the grocery delivery market is still relatively new. It is possible that the market will not be as large as some analysts expect.

Overall, Instacart is a growth stock with a number of attractive features. However, investors should be aware of the risks before investing in the stock.

Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in the Stocks or Crypto Coins. Please consult a registered investment advisor to guide you on your financial decisions.