Wedbush Downgrades Instacart To Underperform On Rising Competition From Amazon

Wedbush downgraded Instacart (NASDAQ:CART) from Neutral to Underperform and cut its price target to $42 from $55, citing heightened competition from Amazon in the online grocery space. Shares fell over 3% on Thursday following the call.

The firm acknowledged Instacart’s recent gains in gross transaction value and margin improvement, which had eased investor concerns. However, it said Amazon’s expansion of its same-day perishable grocery delivery service has intensified competition, making it harder for Instacart to defend its market position.

While Instacart may maintain a niche supporting regional grocers with limited resources, Wedbush argued that consumers will likely gravitate toward more compelling and value-oriented offerings from larger rivals. It warned that Instacart’s market share will likely erode over time unless management can adapt quickly to the shifting competitive landscape.