Instacart Stock (CART) Under Pressure Into Earnings – What To Expect

Instacart's stock (NASDAQ: CART) is facing increased scrutiny today, as it heads into its earnings report scheduled before market open. The stock closed last week at $36.75, a 5.06% increase on the day, yet remained 1% lower on the week. The question now is whether Friday's momentum can be sustained amidst mixed technical signals and shifting market sentiment.

CART is 14.6% lower YTD leading in to the print, with the street expecting to see growth. EPS is expected to have grown to $0.50 (from $0.42 in the same period Y/Y), whilst revenue is expected to come in at $933.32million, for a 9.54% growth rate.

Both the 50-day and 200-day simple moving averages (SMAs) sit above the current price, at $41.06 and $43.88 respectively. This indicates a potential bearish trend, suggesting that the stock may face resistance in the short to medium term. These moving averages are key levels to watch; a sustained break above them could signal a shift in momentum, while continued trading below could reinforce the bearish outlook.

Price Targets

While the majority of analysts are bullish on Instacart, with an average price target of $54.81, the company operates in a highly competitive market with relatively low barriers to entry. New players are constantly emerging, and established giants like Amazon are increasingly focusing on grocery delivery.

Furthermore, Instacart's business model is heavily reliant on the gig economy, which is facing increasing regulatory scrutiny. Potential changes to labor laws could significantly increase the company's operating costs and impact its profitability. 

As Instacart prepares to release earnings, this is an interesting case of Wall St analysts being considerably out of sync with market sentiment, and price action. We will not have to wait long to see how this one plays out in the short term.