Arm and Instacart add to losses after lukewarm analyst reports


FILE PHOTO: A smartphone with a displayed Arm Ltd logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo

(Reuters) - Shares of Arm Holdings and Instacart deepened their recent losses on Friday after analysts gave lukewarm ratings to the two companies that recently held highly anticipated initial public offerings.

Arm was last down 1.7% at $51.23. Earlier it dipped as low as $50.35, below the $51 price set in its IPO on Sept. 13.

Arm surged on its first day on Wall Street and has fallen every day since then.

Grocery delivery app Instacart, formally known as Maplebear, fell 2.1% to $30.02, marginally above the $30 price set in its IPO on Monday.

The weak performances of Arm and Instacart's stocks since their market debuts add to doubts about whether a hoped-for revival in IPOs will materialize after a drought of more than 18 months.

In a client note, BTIG analyst Jake Fuller gave Instacart a "neutral" rating and warned that the company faces heavy competition from DoorDash and Uber Technologies in the slowly expanding market of grocery delivery.

In another note, Susquehanna analysts assigned Arm a "neutral" rating and $48 price target, saying the chip designer "appears to be pushing royalty rates to the limit, while also adding lower margin 'subsystems' revenue".

That followed a Bernstein "underperform" rating with a $46 price target earlier this week, and a "hold" assigned to Arm by Needham and Company on Sept. 16.

Neutral and negative stock ratings are much less common on Wall Street than "buy" recommendations or other positive ratings. Of more than 10 thousand current analyst recommendations for S&P 500 companies, 56% are positive, 39% are neutral and 5% are negative, according to LSEG data.

Meanwhile, shares of Klaviyo, which debuted on Wednesday, dipped 1.8% to $33.12. Still, the marketing automation firm's stock remains above the $30 IPO price.

The declines in Arm, Instacart and Klaviyo on Friday were in contrast to a 0.3% gain in the Nasdaq.

(Reporting by Noel Randewich; editing by Lance Tupper and Kirsten Donovan)

Follow us on our official WhatsApp channel for breaking news alerts and key updates!

Next In Tech News

Analysis-Unglamorous world of 'data infrastructure' driving hot tech M&A market in AI race
Adobe shares slide as investors skeptical of quicker AI-adoption returns
OpenAI to continue working with Scale AI after Meta deal
Brazil's Meliuz raises $32.4 million in share offering to buy bitcoin
Britain says Google's online-ad commitments no longer needed
AMD turns to AI startups to inform chip, software design
Deutsche Telekom, Nvidia to build AI cloud for industry in Germany
Facebook generated up to US$20bil in Asean ad revenue in 2024, RM2.5bil from Malaysia alone, says Fahmi
The most eye-catching products at Paris’s Vivatech trade fair
AI toys and games? Barbie maker Mattel teams up with OpenAI to create new products

Others Also Read