CART Stock Jumps As DoorDash Acquisition Talks Reportedly Heat Up Toward Possible $17B Deal

• Though the company was previously in talks with Uber as well, they are no longer active, the report said. 
• Instacart has previously also evaluated a takeover from DoorDash but talks fell through. 
• While CART currently has a market valuation of about $14.45 billion, DASH is valued at $72.98 billion.

Shares of Instacart (CART) jumped 8% on Monday following reports that rival delivery firm DoorDash (DASH) is in talks to acquire it in a deal valuing the company at $17 billion.  

According to a report from The Wall Street Journal, citing people familiar with the matter, a deal between DoorDash and Instacart could be completed as soon as this week if talks don’t fall apart. Though the company was previously in talks with Uber as well, they are no longer active, the report said.

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DASH stock fell 6% on Monday while UBER closed nearly 1% lower.

Anticipation Of CART-DASH Deal Runs High

The report comes on the heels of another report from The Information last week that the delivery firm is actively exploring a sale, engaging financial advisers and holding preliminary discussions with prospective buyers. A standard takeover premium of 30% to 40%—typical for public tech company acquisitions—could price a buyout in the range of $16 billion to $17 billion, The Information then noted.

Instacart has previously also evaluated a takeover from DoorDash. In 2021, when the company was privately valued at $39 billion, it held preliminary sale talks with DoorDash that could have valued the business at $40 billion to $50 billion. Those negotiations ultimately collapsed due to concerns over obtaining antitrust approval from Biden administration regulators. The company subsequently went public by itself in 2023. While CART currently has a market valuation of about $14.45 billion, DASH is valued at $72.98 billion.

Citi analyst Ronald Josey on Monday kept a Buy rating on Instacart (CART) with a $58 price target. Citi said the report implies a deal value of $65 per share at the midpoint and added that Instacart is the leader in online grocery. Rosenblatt, meanwhile, highlighted that the list of possible suitors for Instacart is long, given it's a “prized asset despite being under attack by two industry goliaths- Amazon and Walmart.”

How Did CART Retail Traders React?

On Stocktwits, retail sentiment around CART stock stayed within the 'extremely bullish' territory over the past 24 hours, while message volume stayed at 'extremely high' levels.  

A Stocktwits user said they are holding the stock given it's currently undervalued.

CART stock has risen 35% year-to-date.

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