Loop Capital has increased its price target for Instacart (CART, Financial) from $52 to $58 while maintaining a Buy rating. This adjustment reflects a favorable outlook on Instacart's growth in gross transaction volume, enhanced advertising contributions, and improved margins based on the latest results and forecasts.
The firm is optimistic about Instacart's prospects as an independent entity but also highlights potential synergies in a merger with Uber. Although there are several compelling reasons for such a merger, including pricing benefits, there are also considerations against it, particularly given the founder’s successor is transitioning to a new role at OpenAI. Nonetheless, Loop Capital believes a future merger between Instacart and Uber is likely.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 27 analysts, the average target price for Maplebear Inc (CART, Financial) is $51.78 with a high estimate of $61.00 and a low estimate of $41.00. The average target implies an upside of 13.41% from the current price of $45.66. More detailed estimate data can be found on the Maplebear Inc (CART) Forecast page.
Based on the consensus recommendation from 34 brokerage firms, Maplebear Inc's (CART, Financial) average brokerage recommendation is currently 2.2, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
CART Key Business Developments
Release Date: May 01, 2025
- Gross Transaction Value (GTV): Grew 10% year-over-year, reaching the top end of guidance.
- Order Growth: Increased by 14% year-over-year, the strongest in 10 quarters.
- Average Order Value: Decreased by 4% year-over-year.
- Transaction Revenue: Grew 8% year-over-year, maintaining 7.1% of GTV.
- Advertising and Other Revenue: Increased by 14% year-over-year.
- GAAP Net Income: $106 million, a decrease of $24 million year-over-year.
- Adjusted EBITDA: $244 million, a 23% increase year-over-year.
- Operating Cash Flow: $298 million, an increase of $193 million year-over-year.
- Share Buyback: $94 million worth of shares repurchased.
- Cash and Similar Assets: Approximately $1.8 billion at quarter-end.
- Q2 GTV Outlook: Expected between $8.85 billion and $9 billion, 8% to 10% growth year-over-year.
- Q2 Adjusted EBITDA Outlook: Expected between $240 million and $250 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Maplebear Inc (CART, Financial) reported a 10% year-over-year growth in Gross Transaction Value (GTV), driven by a 14% increase in orders.
- The company achieved strong advertising revenue growth of 14% year-over-year, outpacing GTV growth.
- Maplebear Inc (CART) has expanded its reach to 98% of households in North America, maintaining consistent customer engagement.
- The acquisition of Wynshop is expected to enhance Maplebear Inc (CART)'s enterprise strategy by powering more storefronts and expanding retailer partnerships.
- The company is leveraging AI to improve operational efficiency, with 87% of its code developed with AI assistance in Q1 2025.
Negative Points
- Average order value decreased by 4% year-over-year due to the addition of restaurant orders and reduced minimum basket size for Instacart+ members.
- GAAP net income decreased by $24 million year-over-year, primarily due to the lapping of stock-based compensation reversals.
- There are concerns from brands about macroeconomic uncertainties, including trade policies and regulations, which could impact advertising spend.
- The company anticipates a sizable step-up in stock-based compensation in Q2 due to the timing of annual refresh grants.
- Despite strong advertising performance, there is potential volatility in brand partners' advertising budgets due to macroeconomic conditions.
