Grubhub Stock Delivers After Earnings Beat

The stock is eyeing its fifth straight day in the black

Deputy Editor
Apr 26, 2019 at 9:53 AM
facebook twitter linkedin

Food delivery concern Grubhub Inc (NYSE:GRUB) is soaring today, after the company posted earnings and revenue for the first quarter that exceeded analysts' estimates. The company says it's gained an edge in the oversaturated market via aggressive spending and strategic partnerships with restaurants. GRUB shares are up 9.6% at $76.50 in early trading, eyeing their fifth consecutive win. 

GRUB's recent rally comes just after the equity hit a one-year low of $63.32 on April 18. Since bottoming out however, the stock has enjoyed a straight upward trajectory, already tacking on roughly 20%. Plus, today's pop has Grubhub back atop its 40-day moving average for the first time since early March. 

The majority of analysts are quite bullish on the stock. Ten of the 17 following GRUB give it a "strong buy" rating. There's still room for upgrades, however, with six "hold" ratings on the table. Adding to this optimism, the consensus 12-month target price of $99.67 is at a nearly 31% premium to current levels. 

On the other hand, GRUB's Schaeffer's put/call open interest ratio (SOIR) of 2.30 sits higher than 99% of all other readings from the past year. This suggests that short-term options players have rarely been more put-heavy in the past 12 months. 

And while short interest has inched lower in the last month, the 15.08 million shares of GRUB sold short still represents a whopping 19.1% of the stock's available float. Plus, at the security's average pace of trading, it would take over a week to buy back all these bearish bets, which could create even more tailwinds, should these positions begin to unwind. 

Begin the New Year With Schaeffer's 7 FREE 2022 Stock Picks!



Special Offers from Schaeffer's Trading Partners