GrubHub upgraded to Buy from Neutral at Roth Capital - InvestingChannel

GrubHub upgraded to Buy from Neutral at Roth Capital

Roth Capital analyst Darren Aftahi upgraded GrubHub to Buy from Hold and raised his price target for the shares to $95 from $92. The stock closed yesterday down 2% to $82.27. The company’s Q4 results were slightly weaker as higher investment suppressed adjusted EBITDA, although diner growth remained healthy at up 22% year-over-year, Aftahi tells investors in a post-earnings research note. The analyst believes GrubHub’s increased marketing spend is likely to “materialize into better growth, thus yielding improving unit economics long-term.” The shares reflect the “majority of these risks” while upside could exist to adjusted EBITDA, especially in second half of fiscal 2019 and into 2020, says the analyst.