Thursday’s Market Insights: Shake Shack Inc (SHAK), Etsy Inc (ETSY), Groupon Inc (GRPN), EMC Corporation (EMC)
By Kate George
Shake Shack Inc (NYSE:SHAK) is down over 3% in pre-market trading to $47.00 after the fast-casual burger joint filed to sell up to 26 million shares, though the company will not receive any of the proceeds from the sales. Shake Shack went public in January with a media-frenzied IPO as burger lovers rushed to the restaurant chain’s over 50 locations. Shake Shack debuted on Wall Street with an IPO of $21, which quickly doubled. By May, the stock was trading was at $92 per share, though shares have since come down a bit. Though analysts were bullish on the company when it went public, it seems more analysts are falling to the sidelines. According to the 5 analysts polled by TipRanks in the last 3 months, 3 are bearish on the stock and 3 are staying on the sidelines. The average 12-month price target is $41.50, marking a 15% downside from where the stock last closed.
Etsy Inc (NASDAQ:ETSY) is down nearly 2% in pre-market trading to $13.90 due to competition from Amazon. Handmade by Amazon launched today as a platform that allows artisans to sell their own crafts; strikingly similar to Etsy’s purpose. Reports say that Amazon’s new platform will offer more than 80,000 items from all 50 states and 30 countries. While Etsy has remained the dominant marketplace for handcrafted goods, analysts are worried that Amazon’s scale and distribution network will pose a threat. According to the 3 analysts on TipRanks who have rated Etsy in the last 3 months, 1 is bullish on the company, 1 is bearish, and 1 is staying on the sidelines. The average 12-month price target is $17, marking a 20% potential upside from current levels.
Groupon Inc (NASDAQ:GRPN) fell 4.71% in pre-market trading down to $3.64 after analyst Kevin Kopelman of Cowen & Co. initiated coverage on the company with an Underperform rating and a $2.75 price target. Although the company “leads in US/Europe voucher deals and has $6B in billings,” the analyst points out that “op. margins are low and trending down.” Kopelman believes the company can turnaround in the future, but attributes his current bearish rating to “growth figures that suggest the marketplace has peaked;” “investment in hyper-competitive food delivery;” and deteriorating margins. According to the 10 analysts polled by TipRanks in the last 3 months, 6 are bullish on Groupon, 1 is bearish, and 3 are staying on the sidelines. The average 12-month price target for the company is $6.24, marking a 63% increase from where the stock last closed.
Click here to view Kevin Kopelman’s past ratings and performance history.
EMC Corporation (NYSE:EMC) spiked 6.70% in pre-market trading up to $27.70 following reports released yesterday that EMC is in talks to merge with Dell. If achieved, the takeover would be the largest merger in the technology sector. Although the deal has not been formally proposed, reports suspect that a deal would value EMC at about its market cap value of $50 billion, though more than half of this valuation is attributed to EMC’s VMware. Dell is a privately held company valued at about $25 billion. This is not the first time that EMC has been in the spotlight for a potential takeover, as the technology company was in talks with HP last year, though this possibility ended once HP announced its plans to split. According to the 14 analysts on TipRanks who have rated EMC in the last 3 months, 11 of them are bullish on the company and 4 are staying on the sidelines. The average 12-month price target for the stock is $29.58, marking a 14% potential upside from where shares last closed.